Questions

Bringing my developer in house full time will provide a small short term lift in revenue with increasing value as the company grows and scales to multiple web properties. He isn't interested in salary as much as equity. My 50/50 business partner and I on the other hand are not interested in giving away equity. We are open to profit sharing, or any other creative solution that will continue to motivate and incentivize him for the long term without having to give up a % of our company. Any feedback greatly helps - thanks!

You already said it: "He isn't interested in salary as much as equity."

If this developer is any bit worth his salt, he is worth the equity. A smaller piece of a bigger pie is far more valuable than a big piece of a small (or worthless) pie.

Profit sharing is a red flag to me that just sounds "Cheap," unless you guys are making tons and tons of profit already.

I don't know where you're based, but In Silicon Valley, a good developer can easily fetch $300-500k (base + bonus + yearly equity). UC Berkeley's average starting salary for NCGs majoring in EECS or Computer Science is $108k.

Salary is something a good developer can easily get; why your startup (possibly unstable) rather than another more established company?

If as the other person said, he walks and you're company is crippled, give him equity.

Happy to chat more.


Answered 4 years ago

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