The equity payday funnel looks bleak.
1. Will this company succeed?
2. Once it succeeds will my equity be valuable?
3. If my equity could be valuable, will it be diluted before I can get paid?
4. If not diluted will it ever be liquid?
5. If there is liquidity will I be able to participate? Or only founders/investors.
6. If employees are able to extract real dollars, will I be forced out, laid off, constructively dismissed in advance to reduce what I could take home.
All I see is a succession of methods to keep me on a treadmill chasing a carrot. Until the startup is large enough to take away the carrot.
This perception is hurting startups as a whole. Because you will not be able to convince early stage talent to work for equity. It is not enough to tell engineers 'well you should learn more about equity so you can't get ripped off so easily.'
1. Will this company succeed?
2. Once it succeeds will my equity be valuable?
3. If my equity could be valuable, will it be diluted before I can get paid?
4. If not diluted will it ever be liquid?
5. If there is liquidity will I be able to participate? Or only founders/investors.
6. If employees are able to extract real dollars, will I be forced out, laid off, constructively dismissed in advance to reduce what I could take home.
All I see is a succession of methods to keep me on a treadmill chasing a carrot. Until the startup is large enough to take away the carrot.
This perception is hurting startups as a whole. Because you will not be able to convince early stage talent to work for equity. It is not enough to tell engineers 'well you should learn more about equity so you can't get ripped off so easily.'