Salary and Compensation Considerations for Early Employees of a Young Company

Linda Wang is Founder of Cambrian Law Group ( In this video she talks about salary and compensation considerations for early employees of a young company.

  1. Compensation packages typically contain equity & salary
  2. Equity: discuss type & quantity
  3. Salary: define scale & schedule
  4. Determine compensation & procedures for firing an employee
  5. Discuss details with a lawyer & get everything in writing

Start ups don't often have money especially in the beginning. And with the start ups that I normally work with, they usually offer compensation packages with a combination of equity and salary. So it is extremely important for every founder and employee to discuss what exactly is in your compensation package and the timing of everything.

So basically you want in terms of equity, you want to talk about what kind of equity is it, what kind of stock is it, is it stock or is it options and how much of everything you're getting.

And in terms of salary, you want to talk about the pay scale and the schedule. Basically, how are you getting paid right now and how much are you going to get paid later. How are raises done.

Another important thing to consider is what do you do when an early employee or founder wants to leave or when an early employee or founder gets fired. What are the procedures for that and what are the compensation packages for those issues.

And the most important thing is to speak with an attorney and get everything in writing and make sure everyone is on the same page and have the documents signed.

So in addressing these issues, you can make sure that everyone knows exactly what we're getting out of the company and there are no disputes later on.