How would you go about pricing your equity in an early stage startup offer? Have two offers right now with different comp components and trying to compare across both to make a decision / negotiate the offers. Current comp ~280-300k TC, 4 YOE

1) Head of Strategy & Ops with 275K Cash Comp + 0.25% equity @ a Series A startup (N-1)

2) Head of Product with ~350k TC (All cash, Base + Bonus) @ a Global Bank (N-1 within the BU)

likeuplifting
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Recently was in a similar boat I ended up sitting with the CFO and he went over the valuation with me and other finances. I’d do something similar

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If it is a series A, I would just look at what that round valued the company at. It is the last time people were willing to pay money for equity.

Recruiters always try to tell you about growth and 5 year validation targets but that doesn't account for risk. The only thing that really counts is what the company can get investors to pay now.

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As an incoming campus-hire BA, this post makes me excited

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This is not the norm I promise haha

likefunny

That is pretty high cash comp at the Series A! Ask for the 409A so you can see current internal valuation and just get your own sense of rev multiple.

Obviously bank is the safe play, but growth will almost certainly be slower just given your YOE relative to cash comp. If you are passionate about the startup product / offering, go that route - cash is good so it isn’t as big of a risk if it fails.

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Bank will survive the recession.. will the startup?

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Should get more equity at series A

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With 4 YOE I think it’s fair. But would push for a bit more. 0.3-0.5% is standard for N-1

What does N-1 mean?

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Means I’d report directly to the CEO of the startup and the to the GM for the Bank BU / LOB (N-1 = “1 layer away from CEO/GM”)

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No bonus at #1?

I would value it at $0 tbh. 9/10 chance you never see a liquidity event. If you do, consider it a nice windfall.

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#1 is 250K Base + 10% target bonus (25K) = 275K TC

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What is your background to be getting these roles at 4 YOE? McKinsey EM?

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Head of strategy and ops is probably like a chief of staff or GM role at a startup - can be pretty valuable to have

25 and making 300k? Wow lucky you

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For a Series A? I wouldn’t price it in at all unless you believe wholeheartedly that this company has the ability to at least become a unicorn and you plan to stay for at least 4+ years. You work in strategy, I don’t have to tell you the state of the current VC market and how it’s now become much more challenging to get to unicorn status than it was just a few years ago.

How did you find these roles? I’m also a BA to EM at McK also and just beginning to look into exits in the early stage startup space

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