Equity vs. Cash Compensation Matrix
Balance equity grants and cash salary to attract top talent while protecting your runway. Enter market rate, cash budget, and valuation to see the suggested equity trade-off.
- Calculates suggested equity grant to close cash gap
- Accounts for startup risk premium
- Shows 4-year equity value at current valuation
- Includes vesting structure guidance
What this covers
This tool helps you balance equity grants against cash salary to build competitive offers when your cash budget is constrained. Enter the market rate, available cash, and current valuation to model the equity trade-off.
Who this is for
- Founders structuring offers for early hires where cash is limited
- CFOs and finance leads designing compensation packages
- HR teams benchmarking equity grants against market norms
- Any startup offering equity as part of total compensation
How to use this
- Enter the market rate salary for the role, your cash budget, and current company valuation
- Review the suggested equity grant and 4-year value projection
- Adjust inputs to model different valuation scenarios
- Use vesting structure guidance to design a competitive package
Limitations
Equity values are projections, not guarantees. Future valuations may be higher or lower. This tool is for planning purposes only and does not constitute financial or legal advice. Consult legal counsel before finalizing any equity grant.
Common Questions
How is the suggested equity grant calculated?
The tool calculates the equity value needed to close the gap between your cash offer and the market rate, factoring in a startup risk premium based on stage. It then converts that value to a percentage grant based on your entered valuation.
What vesting structure should I use?
Standard for most startups is a four-year vest with a one-year cliff. This means no equity vests in the first year, and then it vests monthly or quarterly over the remaining three years. The tool provides guidance on this structure as the default.
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