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Hey folks, been away a few weeks, nose to the proverbial grindstone, making connections. Quick question for the community, especially you folks who take equity in a business in return for your time.
Can someone give me any advice about the level of equity you’d be looking at based on, say, a per-day basis? I do understand that what funding stage the business is at and its trajectory will define what you’re willing to work for, but any broad brushstrokes?
I’m working out a deal on an app as co-founder.
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Interesting question! Tagging some startup founders and advisors who might be able to offer some insight – Ben Legg, Paul David Mather, Zarir 'Zed' Vakil, Cristian Oancea, Nathan Wilson, Yigit Senkardes, Niall Brady, Philipp von Bieberstein, Nikhil, Dimitris Protogirou, Stuart Prestedge, @rumkea, Kevin Withane, Ryan McGee, Natalie Tucker, Katie Muldoon, Anna Zuccarini
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Hi David – equity payments are higher variable. In general, I’ve seen them a lot more commonly in very early-stage venture (pre-funding/pre-seed). Once sophisticated angels or VCs get involved, they often only allow equity options for key employees and star board members (e.g. bringing on a chairperson or board member with decades of experience in the industry where the startup is operating).
In the pre-funding days, it’s a bit of a wild-wild West. It mostly depends on the a…
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Great question David Worrall. We have an article on how much to charge here: http://staging.the-portfolio-collective.com/insights/how-much-should-you-charge-for-portfolio-work
It’s a good primer, though doesn’t go into detail re stock options. My normal rule of thumb is to work out the time that you will commit to a client/ job, then convert that into what you would charge at your standard hourly/ daily rate. Once you have that number, ask for enough stock options that should pay you …
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It varies in my experience. I’ve seen founders allocate a % pool of sweat options for advisors. For example, 1% of company at seed stage, split 5 ways i.e. 0.2% per advisor, vesting over time based on a commitment of x days per month. I’ve also seen founders pay sweat equity by calculating the number of days an advisor contributes e.g. day rate of £750 * 2 days last quarter = £1500 of shares granted at current valuation. I’m sure there’s plenty of other potential models…
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I can echo Cristian Oancea feedback. All the early stage ventures where I received equity were pre-seed and before they had investors. A good friend who is a very successful VC once told me that (to VC’s) sweat equity is worth nothing! There really is no standard rule as far as I know, and for me it varied based on the value the founders believed I could bring, my relationship with them and their level of startup experience. A first-time founder I worked with agreed to 8% – 10% equity b…
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I don’t think I can add any more valuable insights to the ones already given and I think very much it is horses for courses. I think a combo of Cristian’s philosophy on this and Ben’s abacus probably gives you a base to work from. Paul and Nikhil have offered up come real world examples. I think protecting founders who have not been through this before is important and I think there is a very different situation for advisory sweat (much less) and real co-founder (cash and swe…
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David Worrall posted in the group The Marketing Hub
I’ve worked for some global agencies (Publicis Media and Dentsu) so if anyone wants any advice about their operational side, more than happy to answer your questions.
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David Worrall posted in the group The Marketing Hub
Looking to the community to get some hard advice as to how to go about getting an ”in” with a VC group.
I.e. the VC group or individual buys into a business and brings a pool of resources to ramp up scale and efficiency into the business. Usually this would be from their network, I’d hazard a guess. So is there a particularly good source to offer some pro-bono work to that has a reasonable expectation of pay off if the work is quality?
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David Worrall posted in the group The Marketing Hub
Hey folks, welcome to the new TPC Marketing Hub, a place for active discussion about marketing.
Whether your skill, query or passion is offline, online, digital display, OOH, print, press, radio, TV, you’re in the right place.
We have a huge group of marketeers here, either traditionally or self taught, and there’s a lot of people needing help in this field, so come and join the group if marketing is ever likely to play a role in your portfolio career.
1 Comment-
Oooh nice shout David! I love a good marketing discussion!
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David Worrall posted in the group The Community
Hi folks, I’ve just set up a marketing group for anyone interested in marketing to join. Please feel free to pop along and contribute.
http://staging.the-portfolio-collective.com/collective/groups/the-marketing-hub/?swcfpc=1
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Good question. I would be interested to hear what responses this generates