Startups are often cash strapped and need to pay employees in equity to be competitive.

The employee, however, may be willing to take less or more cash depending on their current circumstances (e.g., if they have children, need to pay down loans, etc.).

We recommend offering multiple packages and allowing employees to pick which one is best suited for them. A common combination is:

  1. An equity heavy package that sacrifices cash salary for additional points of equity

  2. A cash heavy package that sacrifices the equity for additional cash salary

  3. A balanced package that provides a middle ground in between

This provides flexibility for your employee and grants them agency in their compensation, further aligning incentives and providing a better hiring experience.

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