Article · 12 min read

How to Structure Startup Equity for Early Hires

Pear VC Free Intermediate

A focused guide on the early employee side: how to size grants for your first several hires and set up the option pool. It gives concrete percentages that sit clearly below co-founder territory, which is exactly the line you are drawing. Read it alongside the Carta data for a full picture.

  • Size early hire grants by seniority and join order, in fractions of a percent to a few percent
  • Reserve an option pool up front so grants come from a plan
  • Early hires get real equity, but an order of magnitude below co-founders

The question it answers

  1. What equity should I offer a technical co-founder vs. an early engineer?

Read with it

  1. The definitive, data-driven book on early founding-team decisions, drawing on quantitative research covering nearly 10,000... Princeton University Press Book · ~480 pages The Founder's Dilemmas Noam Wasserman
  2. The canonical dynamic-equity framework for fairly splitting ownership based on real contributions before funding, when nobody... slicingpie.com Tool · Framework + software + handbook Slicing Pie: Dynamic Equity Split Model & Calculator Mike Moyer
  3. Altman's condensed operating manual for founders, including sharp guidance on focus, spending your time on what only you can... playbook.samaltman.com Article · long Startup Playbook Sam Altman
  4. This is the essay to read first, from a YC partner who co-founded Justin.tv/Twitch and has done equal splits across his own... Y Combinator Essay · ~8 minute read How to Split Equity Among Co-Founders Michael Seibel
  5. A free, no-signup calculator that forces you and your co-founder to actually weigh the inputs (idea, roles, who is full time,... Foundrs Tool · ~10 minutes to work through Foundrs Co-Founder Equity Calculator Foundrs
  6. When a term sheet lands and you are tempted to fight over the last point of valuation, this is the essay that reframes the... paulgraham.com Essay · 12 min read The Equity Equation Paul Graham
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