Ask HN: Paying Startup Employees with Debt?

1 points by eru ↗ HN
In addition to a salary it is common to pay employees in a startup with equity (or call options on equity).

As an employee I never trust those offers, and treat them like lottery tickets at best. Partially because of the financial shenanigans insiders can play to dilute those shares, and also because I find it hard to value the company. And as a founder, I might not want to hand out equity to avoid dilution.

I have sometimes suggested to get paid in something closer to debt instead of equity:

For example, a note that pays eg 1 dollar a month and can 'called' by the company in exchange for a one-time payment of, say, 150 dollar (or an equivalent amount of equity, if both parties agree).

Or perhaps something closer to a safenote? Or something completely different?

1 comment

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Um…what you want here is a salary.