Article · 20 min read

Rewarding Talent: Founders, Investors and Employees

Index Ventures Free Intermediate

This is the durable reference for the structural line between a co-founder and a hire: co-founders own the company outright on day one, everyone hired afterward comes through the option pool, and even a senior non-founding CTO or VP lands in the 0.8% to 1.5% executive band, not the founder tier. Reading it makes the cost of mislabeling a senior hire as a co-founder concrete before you sign anything.

  • Co-founders start with 100% between them; every later hire is granted from the ESOP pool, a hard structural distinction
  • A non-founding C-level or VP hire typically lands around 0.8% to 1.5%, an order of magnitude below founder equity
  • Model the dilution across future rounds before you grant, since a founder-sized grant compounds into a very expensive mistake
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The question it answers

  1. What's the difference between a co-founder and an early key hire, and how do I decide which I need?

Read with it

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  2. Once you have decided a key hire gets an ESOP grant and not co-founder shares, this is the India-specific playbook for actually... Razorpay Rize Article · 15 min read ESOPs / Employee Stock Option Plans: Structuring for Early Startups Razorpay Rize
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