Show Info: Unfiltered insights and actionable advice straight from the trenches of startup and business life by Steli Efti and Hiten Shah, two serial entrepreneurs who've both built multi-million dollar SaaS startups.
In this episode, Steli and Hiten talk about the tricky aspect of giving equity. While there is no standard way to give equity as companies follow their own rules, there are norms that you can choose to follow—especially if you are just starting. Listen as Steli and Hiten give their tips on how you can negotiate equity with your team members, what a fair offer would be for early startups, and how such a deal communicates TRUST and a long-term relationship, at the end of the day. Time Stamped Show Notes: 00:07 – Today’s episode is about how to give equity to team members 00:40 – There are formulas and calculations on how to compute equity, but Hiten does not think there is a right answer for this 01:20 – There are norms on how equity is given: the year cliff and four year vesting 01:33 – The year cliff is when you get the first chunk of equity—which is a quarter percentage equivalent after your first year—over a four year period 02:08 – Monthly vesting 02:24 – There are other rules for other companies 02:48 – Hiten says that if there is a lot of equity to be given, he would go with the standard 03:20 – In the early days, many startups struggle with the equity question 03:55 – In some cases, it may be easy—especially for those who spend equal amounts of time and just divide it equally 04:26 – In most cases, everyone is doing a different task and the value differs not just for founders but also those who have hired their first employees 05:36 – There is a lot more material availa
