I'm in talks with a startup founder about a job, pretty much a CTO role. At the moment it's only 3 people there, I would be the 4th one. It's all running off the founder's pocket now, he says he's got enough to support it for now from the sale of his previous startup.
Now he asks what are my expectations about money - salary + equity. I have no idea, esp about the latter.
How much equity is a reasonable expectation in this situation? And what does it mean for the salary? I know what I earn now and what I could earn elsewhere in a standard full time job. But how does that change when I'm offered some equity in the startup?
Also what happens to the equity when the startup raises capital. I read somewhere that the equity of common employees sometimes gets diluted so much that after the exit they get next to nothing, or even nothing at all. Is that normal?
Is there a way to protect against that? Not keen to work for under-market salary for years and then get no payout in the end. Assuming the startup actually succeeds and gets acquired or IPOs of course, which is a topic for another day but let's assume that it does. I just don't want to be screwed in the process.