At eShares we spend a lot of time thinking about how to better educate employees on startup equity. Even new hires at eShares often don’t understand the equity compensation component of their offer letter. So we decided to create a new offer letter. We are sharing an example of our offer letter, which you can find here. I have also included some highlights below with captions. I hope this will encourage transparency in more companies and help candidates who are currently interviewing at startups.
Summary of all relevant salary and equity information.
High-level view of organization chart and zoom-in of new employee’s team.
Explanation of how we set salaries
Simplified graph of our capital structure and breakpoints
Formula for calculating option payouts for exit values greater than $77M
Tranche-by-tranche table of employee’s vesting schedule
Brief advice on how we encourage employees to think about their equity
Overview of benefits
Home office address and weekly commute schedule
Introduction to first week’s schedule and 1-on-1s
Required legal language regarding option details and pending board approval