How do I decide how much stock early team members and advisors get?

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The useful way to size a grant to an early engineer, a part-time contributor or an advisor is to build a rough cap table for the company as it will look after its first real financing, decide what percentage each person should hold at that point, and convert that into shares today. Asking what percentage someone should get before any round exists produces numbers that mean little, because nobody knows yet how many shares the seed round and the option pool will add. Working backward from the post-round table turns a vague percentage into a share count that will still make sense in eighteen months. A worked example Three founders and an advisor expect to raise a seed round in about eighteen months, taking in $2 million including a converting SAFE, at a valuation that leaves the investors with 20 percent. They assume investors will want a 10 percent unissued pool after closing and that 5 percent will already have been granted to early hires. They set the post-round fully diluted count at 10 million shares for simplicity. The advisor wants 2 percent after the round. Working back: investors 2 million shares, pool 1 million, early hires 500,000, advisor 200,000, and the remaining 6.3 million split among the founders by whatever ratio they have agreed, perhaps 2.3 million, 2.3 million and 1.7 million. Those founder and advisor numbers are what to issue now. Founders, and people who join later Among founders the conversation is about roles as much as arithmetic: who is likely to be the CEO, who is building the product, who is part time until the round closes, who had the idea and has already put in a year. An equal split is common when all of that is roughly equal and a source of resentment when it is not, so have the conversation now rather than at the first round when an investor asks why the part-time founder holds a third. A person who will only join once the company is funded is not taking the same risk and usually gets less, often as an option grant when they arrive rather than founder stock today. Advisors and contractors Advisor grants are small: a fraction of a percent to one percent post-round for someone who will spend real hours, less for a name on a slide. They vest, usually monthly over one or two years with no cliff, and they are documented in an advisor agreement that also assigns any intellectual property the advisor contributes. A contractor doing early coding is paid in options or restricted stock under the same principle, with a share number, a vesting schedule and an assignment of what they build. Whatever the numbers, everyone's shares vest. The projection above assumes the four people are all still there after the round, and the vesting schedule is what makes the table survive if one of them is not.

How do I decide how much stock early team members and advisors get?

A worked example

Founders, and people who join later

Advisors and contractors

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