Calculate How Much Your Stock Offer Is Worth in Terms of Wages
Let’s say you’ve just received a job offer from a startup. The salary is small (this is a startup after all), but you also get what is called equity . Here’s what it means and how much it costs.
Startups often offer equity to new hires. In fact, they offer partial ownership of their company – usually a small fraction. This means that if the company grows and makes a lot of money, these stocks can be quite profitable. Of course, if it doesn’t, your equity won’t be worth much.
A site called SalaryorEquity.com can help you figure out how much your capital will be worth in dollar terms. Creators Natalia Rodriguez and Matt Wallart developed the site after helping a friend go through this very process.
“So when Natalia and I were looking for something to work on together, this idea kind of surfaced,” Vallart told us. “She made this beautiful, simple design and all the code so that it can be rendered on the client side without giving us data.”
The broader context is technology injustice, he explains:
“Women are less likely to accept offers that contain equity than those that are direct money, and this is bad for the tech ecosystem because it means we have relatively fewer women with big payouts. Which, in turn, means that less of that money comes back in the form of angel funding, with women more likely to fund women than their male counterparts (due to rampant sexism in the industry). This is a giant cycle that needs to be broken. Hence this instrument. “
To use this tool, you need to know the valuation of the company in addition to the funding received. Sometimes this information is included in your proposal letter, but often it is not, which means you have to ask the startup.
“If they refuse to answer, this is a warning sign – they offer to pay you, but refuse to tell you the basic facts that would allow you to appreciate it? Not exactly an open culture, ”Vallart said.
You enter this information into the tool and it calculates the numbers for you and gives you an estimate of where your capital is being translated in terms of wages. To try the tool for yourself, follow the link below.