Ask HN: How Much Equity to Offer First Employee?
My first potential employee is a good friend of mine. I've been bootstrapping from his basement for a while now and he has been very helpful to me in general administrative terms. He is also a very good sales man (in his day job) so I've decided to bring him on board formally.
He raised a question recently about knowing how much equity is coming to him. Apparently his wife has been stressing and complaining about the amount of time he spends helping me out. :)
His role is principally going to be sales related. Cold calling, meeting clients, and hopefully closing sales of our software.
On my part, as the Founder, I wrote the software, invested over $10000 of my cash, and raised over $40000 in debt from family to build the business and run the SaaS platform.
If you put yourself in my shoes. What would you think is an appropriate amount of equity is appropriate to offer him? Naturally, it will vest over 3-5 years.
Assuming the "employee pool" is 20%, and you still plan to hire more people and the business builds momentum, what would you offer? Or perhaps would you just offer him a commission on sales? or both?