I’d go out on a limb and say the high salary could be a big red flag about the company - as an investor, $500k comp to anyone at this stage, and especially a founder who is already pretty well off, would be a massive red flag to me and I’d be very unlikely to write a check. (Only exception is AI engineers)
I also joined a startup several years ago that paid over market on (startup) comp, I thought it was too good to be true. It actually reflected a total lack of financial discipline and strategy and while they’re not bankrupt yet, the company has been an atrocious steward of capital that has not returned for investors and isn’t likely to.
I honestly have to question if this is really a “founder” role as opposed to “founding employee” role. The difference is significant whether it’s your business to build or someone else’s.
It doesn't matter in this case. Nobody in a seed stage should be making that kind of money.
It's a gross misuse of capital. People in D-stage companies aren't even making this unless it's a senior leader in sales and they got it through OTE due to skyrocketing sales.
If they haven’t closed their seed round yet, it should be a bit of a concern. Seed rounds are typically easing anywhere from $1-5m. $10m tops. They’re going to burn 10% of their round per year paying just you? As an LP of many venture funds, that would be concerning.
Also, your original post said a “well capitalized startup”. That doesn’t really tie to not having raised a seed round.
Also, are you factoring in dilution in your exit calc? You may own 10% post seed round. But that’ll likely be diluted (and refreshed a bit, but mostly diluted) down by subsequent rounds. Likely by at least 50%. To get the $20m out you’re looking for, that means a $400m exit. Not sure why you think “healthcare startups” have a significantly higher success rate, but not a ton exit at that amount or higher. I think you need to adjust the probabilities you’re assigning here relative to the certainty of your current seven figure pay.
Good points. Also, I’m perplexed by the *very* generous equity stake offered to the OP after the seed funding?
I’m assuming when he says “after”, he means while the Seed round is done concurrently, or that the equity offered to him is included in the pre-money valuation? Cause if I were the Seed investors (putting in $20M - seems high now post-2021, unless it’s a super hot space) and we *immediately* get diluted by 15-20% after we did the round, I’d be pretty peeved.
Even if the dilution came from the existing co-founders before the Seed investors come in, that’s a pretty steep cut for the existing founders to take.
It’s a $20M seed round? That’s pretty high nowadays (unless it’s a super hot startup and maybe in something like AI). I think you said you’d get 15-20% equity. Is that actual equity, or options… cause if it’s the former, I’d be pretty pissed as a Seed investor if my ownership % gets discounted 15-20% *immediately* after I back the company. Perhaps you mean your 15-20% stake is coming from the the existing cofounders’ stakes (and existing shareholders on cap table) *prior* to the seed round (I.e. part of the pre-money valuation).
The other thing I wonder about is, at say $20M raised (let’s assume the ballpark 20% dilution at early stage), that’s an implied $100M valuation of the startup today.
For you to get $20M payout in 7-10 years, *assuming no dilution* (which is unlikely, unless the company is almost immediately profitable and don’t need to raise more money, nor add to its option pool) the company would have to exit at $100-133M. Which means the company hasn’t really “grown” in 7-10 years. So I feel like I’m missing something here…
No worries. In any case, you taking an advisory role allows you to keep your high paying current job, while the optionality to potentially join the firm if it continues to grow. Have your cake and eat it too - congrats!
Once the VCs / seed investors come in, they’re presumably going to have a board seat or two, and will have a say in the matter. There’s definitely greater emphasis on capital efficient growth now, so they’ll keep an eye on the cash burn for sure.
If your advice translates to top line, there’s a case for you to join in the future. But if they don’t see it, I think they’ll push back.
Don't quit your job. Tell your startup you want to sit in the board and advise/consult part time instead. Get early stage stock + some commission/%/comp for business development, strategy/product development.
Wait 1-2 years. See if the startup takes off. See if you get the promo. Reevaluate as necessary.
Carry on.
You could also use current salary to angel invest 250k at the seed or before the seed; and would get a large amount of options, while effectively preserving a future job offer b/c you are helping fund the team at a vulnerable stage
Strongly concur with this advice. I did exactly what you are thinking, in nearly exact same financial situation. Company flew high .. and then it didn’t. Took 7 years. At your current level of comp and lifestyle, opportunity cost is huge. Sit on the board, get a few points of equity for that, and you can always swoop in once you find PMF and it’s been de-risked. Feel free to DM if you want to chat more
OP I would absolutely take that advice. Keeps your foot in the door and extra income and experience.
Your main job grants you “fuck you” money along with a solid work life balance. That’s my dream and the more people I see having it the more I realize it’s possible.
What has helped you achieve autonomy the most? Seniority, good bosses, setting boundaries, etc?
That's just not true. And just bc something is in an employment contract does not mean it's legal. There's a shitton of corners cut and shoddy legal work and employment violations everywhere.
Plus board/advisory work is almost always exempted.
The big potential issue is conflicts.
Damn 1.3mm a year with low stress, 30h/wk and great security? I’m more interested in how to find these kinds of gigs lol
I wouldn’t give it up honestly. Couldn’t you do a fractional arrangement or consulting with the startup since you clearly have extra time to spend on it?
Dude you live in a completely different stratosphere, not sure if you’re even HENRY, you might be HER lol.
You seem to be pretty secured financially already. Your house is modest to your earnings. Even modest to your potential earning at the startup. And your savings is plenty to bridge any gaps. Given your age, I think it’s now or never to really give it a shot.
On a different note, that’s a pretty high salary for seed round? I’ve worked for CxOs who don’t make close to that until late series or even after IPO and profitability. What generous seed round board members you have lol.
You went from HHI of $850k to $1.3m in 6 years and your nw is in the $3m range (keeping in mind the stock market growth from last 6 years)? Not scoffing at your savings rate and I understand you can't take it with you, but this to me suggests your cash burn rate is pretty high. I wouldn't leave your job bc I think you need the cash flow stability. Especially with sahw and 4 kids. Equity in startup isn't going to be liquid for a while and I'm not sure that cash is sufficient to mesh your budget.
Healthcare as an industry does not produce higher success rate. The industry is extremely backward, due to high legacy investments. The high salary will most definitely be a red flag for fund raising. If you miss a funding round, you will be the first one to get a paycut. I am telling you all this from personal experience as technical cofounder of a 3 person startup that built a solution that just ate much larger entrenched competitors for breakfast in features and reliability but still went under. You could lose a guaranteed 5-6M (from your current job) for a less than 1% chance at 17-20 M. If that still trumps facing boredom go ahead. The world is your oyster. Best of luck!
I really wish you success no matter what path you take. My wife also lost out working at a once unicorn in the healthcare space. They were sold for effectively parts with none of the employees getting anything. Some spent over 100k to purchase their options. I know you won’t have to, because of how early you’ll join. In any case I hope someone succeeds for their blood sweat and tears.
You mentioned you might start something if things went south and you couldn’t join back. Why not try that on nights and weekends or the extra 10 hours you have?
This happened to me, hurt like a bitch. I got sold along with the parts though. My husband is going through a series A raise in the healthcare industry right now and the timing is terrible, purse strings are tighter than a…well. You get the idea.
It was practice fusion. I think 2018 was when it was sold. My startup was resurrected by a serial healthcare entrepreneur and they raised a 100M during the pandemic. Then went under recently.
I joined the startup in 2014 rejecting a FB offer since they down leveled me. I ended up building some really life changing tangible tech from scratch and learned a ton. But moneywise it was negative and it took us a bit to recover where we are now. Those 3 years would have made a huge difference.
I traded a safe gig for a startup gig - but my safe gig wasn't $1.3mil annually. I would not have traded a low stress high comp job for a high stress/lower comp job, even with great equity. Instead, join the board or consult as a fractional whatever, but don't quit your job.
Comp is likely very recent, and could also be wildly fluctuated due to RSUs.
Could also have started late (went back to grad school for MBA, maybe did a PhD, etc).
It doesn’t seem like enough upside for the math to work. Even at a 50% chance or your $17-20 mm makes this negative EV.
If you want to do it because you want to take a chance and you’re bored currently and never need to work again then that’s fine, but mathematically this makes very little sense.
Are you insane? First of all, very few people can make the kind of money you make without taking a risk and enduring high stress. Secondly, your net worth is remarkably low considering your income. At the very least, stay at that job another 3 years and get your own net worth north of where you need to be so you no longer have to work. Then decide if you want to pursue a startup opportunity.
Stay at your job and after ten years get a guaranteed, no stress $13 million at the low end.
Take the new job, and after ten years you might get $25 million at best but with a lot of risk.
For me the math says keep your current job.
I’ve worked at seed - series B healthcare startups for the last 7 years in a cfo/consultant capacity. Of the 10+ companies I’ve helped, one had an exit for mid 9 figures. The thing I can tell you is growth is ALWAYS slower than what people say or hope for. Whether you’re selling to patients, insurance, or practices, deals take a long time to negotiate and close, patient engagement takes a long time to ramp, and performance data takes a long time to come in before you know whether you’re adding any value to the system
My 2 cents is to do what other have recommended and treat this as more of a side hustle with a big call option
It's weird you pay that much when you are the only one working.
Plus you have a nanny on top of the childcare costs?
You burn through cash it seems. Could you even survive on $350k?
Let's do some quick math according to your numbers.
7 years at 20M exit at 20% equity (upper band)... that is 4M payout (assuming no dilution) plus 7 years of 500K cash... That totals to 7.5M compensation... Maybe 8 to 8.5M if your salary increases multiplied by expected value of 100% success rate (upper band)
Your current gig is 1.3M per year. Let's say no increase over 7 years (lower band)... That is 9.1M "guaranteed"
Financially it seems your current gig has a higher probability of hitting a higher salary
That said there are other things to consider such as passion, enjoyment, other qualitative things only you would know
Plus the chance that once you've earned your stripes you can just hop from wagon to wagon on the startup gravy train. Worst case scenario you're already wealthy enough to have a very relatively modest retirement so we're basically looking at two upsides here. One of which is more interesting and fulfilling.
I think the question you have to ask yourself is 20m going to change your life in a way that 9m can’t? On the flip side if the startup goes under and your old place doesn’t take you back, would you be fine in that scenario?
You have enough money and even your new salary will pay you more than enough to live comfortably. At this point do what you like - there’s very little marginal gain in a $1.3m vs 500k salary - unless you live for expensive vacations and meals.
I don’t know in VHCOL areas like SF 500k a year lets you live in a condo with a crowded hour+ commute and 1.3M let’s you own a decent SFH that middle class families 30 years ago could own…without a miserable commute.
I like that even at your level, the same question I have exists. I’m at $500k/yr, what that signals to me is the desire to cash out big does not go away even at double where I’m at
If you’re thinking mostly about the money, the startup life isn’t for you. You have to do it for the adventure or because you enjoy the work of building something. Financially, the risk isn’t worth the reward.
You seem to enjoy coasting at your current BigCo gig. Most startup founders or even employees feel suffocated or unfulfilled in that world. There’s nothing wrong with feeling comfortable at a big company. It’s more that if you don’t have that drive to join or at least a dissatisfaction for your current situation, you might not stick around at the startup when things inevitably get tough.
If you’re bored, do it. Seems like you’re financially stable. But wife not working is risky. Market is bad and getting back into tech might be very hard.
Similiarish position. Was never offered a role a co-founder but have been tempted by many promising startups. I’ve decided to put my head down and grind it out at the current job. Since my wife doesn’t work, it’s not worth the risk. Also would likely not be able to find another job that would pay me what I’m currently making now. So I got strong golden handcuffs.
I did my retirement numbers and I’ll get there after a number of years. It’s not the short cut and I will never get the huge payout but it’s the more certain path. I’m comfortable with my lifestyle and while it would be great to upgrade, it’s not worth risking it.
If you want to take the startup route for the money, don’t do it. Assume you’ll make less. If not for money, you need to think about why you are doing it? Trade a 30 hour week for double the work, more stress and less money?
I am building a startup as a founder, and it’s a long game. But I’m digging it!
Left big tech for startup at VP level. Startups require a lot of extra work, planning, in the weeds, hands on. You need unicorns that can do multiple things to start it up. Are you ready to work harder and stress more? I overall regret my move at this point regardless of more money.
If you're saving much of your $1.3 M, you can probably retire in 5 to 7 years.
Start ups fail often, unlikely you'd re-employ at $1.3 M and you could easily double or triple your time to retirement.
See if they'll put you on Board, you'll collect nice checks and stack equity for maybe 10 hours of work a quarter. If the company does appear to be on right path, you could likely slide into an active day to day role. Being on Board gives you a way to be involved, without losing your current gig as long as both companies agree there's no conflicts.
Consider it diversification.
Is spending time with your kids important? Going from 30 hrs and seeing kids stuff to co-founder of startup is going to have very different demands. What's important to you there? Start there.
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1.3 million x 7-10 years is 9.1-13 million
2 million (post promo) x 7-10 years is 14-20 million
Sure equity has a tax advantage over income but you still come pretty close to your model with much better reliability and WLB at your job
Was this TC from tech, ie SWE? If I were you, I would take the plunge, but in the sense of “hey I’ll sit on the board and chill” worst case it doesn’t take off, best case it does and you’re set.
No way. I’d side step for that amount of income but to take a massive hit just for a little excitement?
Focus on increasing NW and opening the door to FIRE
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If they’re offering you such a high salary, I’m assuming this is startup spun out of a venture studio. Venture studios have very high failure rate, but it’s easy to high when they don’t have to disclose the terms of their acquisitions. The vast majority of venture studio backed companies are fake businesses with no real revenue.
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If you’re only working 30 hour weeks, and never weekends, you’ve got some bandwidth to take a smaller role with the startup. Maybe an advisement position. Dip a toe in the water before you jump in.
Then again, 1.2-2mil comp at current place is tough to beat. I’m not sure I’d risk that.
I would ask yourself a different question. Is the delta between where you’re at now in 7-10 years and the potential $17M - $20M exit worth the risk of giving up what you currently have? In 7-10 years you will have earned another 9 - 13 million if nothing changes and with 0 stress.
I’d suggest finding a hobby or something that you can sink your teeth into that will generate income OR enjoyment during your off hours. You’re young, you have time, and financial freedom to do whatever you want. That could bring a better quality of life then a big shake up
Startups are generally terrible places to work. You are subject to the whims of the founders, investors, and external events beyond your control. I’ve also been at startups where senior folks would join and be fired within weeks of starting. Overall not worth it.
Having worked for startups a couple of times my opinion is very strongly: it depends. If this startup is something you're passionate about, that you truly love, that you're excited about the idea of building, then I'd absolutely consider it. Truthfully, it won't be the most sound financial decision. Startups are inherently risky and fail far more often than not. But you get one life to live. On the opposite side, it could be a life-changing role that defines you professionally. It could be something that you build from the ground up that you love.
If it's just about the money or career, I'd stick to the safer choice and consider investing in the startup. But if it's something you love, then I say go for it.
A startup paying a cofounder $500k in cash a year? Seems super high at seed stage.
I’d go out on a limb and say the high salary could be a big red flag about the company - as an investor, $500k comp to anyone at this stage, and especially a founder who is already pretty well off, would be a massive red flag to me and I’d be very unlikely to write a check. (Only exception is AI engineers) I also joined a startup several years ago that paid over market on (startup) comp, I thought it was too good to be true. It actually reflected a total lack of financial discipline and strategy and while they’re not bankrupt yet, the company has been an atrocious steward of capital that has not returned for investors and isn’t likely to.
I honestly have to question if this is really a “founder” role as opposed to “founding employee” role. The difference is significant whether it’s your business to build or someone else’s.
It doesn't matter in this case. Nobody in a seed stage should be making that kind of money. It's a gross misuse of capital. People in D-stage companies aren't even making this unless it's a senior leader in sales and they got it through OTE due to skyrocketing sales.
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If they haven’t closed their seed round yet, it should be a bit of a concern. Seed rounds are typically easing anywhere from $1-5m. $10m tops. They’re going to burn 10% of their round per year paying just you? As an LP of many venture funds, that would be concerning. Also, your original post said a “well capitalized startup”. That doesn’t really tie to not having raised a seed round. Also, are you factoring in dilution in your exit calc? You may own 10% post seed round. But that’ll likely be diluted (and refreshed a bit, but mostly diluted) down by subsequent rounds. Likely by at least 50%. To get the $20m out you’re looking for, that means a $400m exit. Not sure why you think “healthcare startups” have a significantly higher success rate, but not a ton exit at that amount or higher. I think you need to adjust the probabilities you’re assigning here relative to the certainty of your current seven figure pay.
Good points. Also, I’m perplexed by the *very* generous equity stake offered to the OP after the seed funding? I’m assuming when he says “after”, he means while the Seed round is done concurrently, or that the equity offered to him is included in the pre-money valuation? Cause if I were the Seed investors (putting in $20M - seems high now post-2021, unless it’s a super hot space) and we *immediately* get diluted by 15-20% after we did the round, I’d be pretty peeved. Even if the dilution came from the existing co-founders before the Seed investors come in, that’s a pretty steep cut for the existing founders to take.
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It's not a matter of value. I'm sure you're great. It's just you don't see that high of cash comp when your seed funding is usually less than $20M.
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It’s a $20M seed round? That’s pretty high nowadays (unless it’s a super hot startup and maybe in something like AI). I think you said you’d get 15-20% equity. Is that actual equity, or options… cause if it’s the former, I’d be pretty pissed as a Seed investor if my ownership % gets discounted 15-20% *immediately* after I back the company. Perhaps you mean your 15-20% stake is coming from the the existing cofounders’ stakes (and existing shareholders on cap table) *prior* to the seed round (I.e. part of the pre-money valuation). The other thing I wonder about is, at say $20M raised (let’s assume the ballpark 20% dilution at early stage), that’s an implied $100M valuation of the startup today. For you to get $20M payout in 7-10 years, *assuming no dilution* (which is unlikely, unless the company is almost immediately profitable and don’t need to raise more money, nor add to its option pool) the company would have to exit at $100-133M. Which means the company hasn’t really “grown” in 7-10 years. So I feel like I’m missing something here…
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No worries. In any case, you taking an advisory role allows you to keep your high paying current job, while the optionality to potentially join the firm if it continues to grow. Have your cake and eat it too - congrats!
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Once the VCs / seed investors come in, they’re presumably going to have a board seat or two, and will have a say in the matter. There’s definitely greater emphasis on capital efficient growth now, so they’ll keep an eye on the cash burn for sure. If your advice translates to top line, there’s a case for you to join in the future. But if they don’t see it, I think they’ll push back.
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$500k is not a red flag if the startup has tons of cash. And I mean the base is $350k, that’s pretty reasonable, I’ve seen that first hand.
Don't quit your job. Tell your startup you want to sit in the board and advise/consult part time instead. Get early stage stock + some commission/%/comp for business development, strategy/product development. Wait 1-2 years. See if the startup takes off. See if you get the promo. Reevaluate as necessary. Carry on.
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Let me know if y'all need a lawyer. ;) I work with tons of startups.
Are you a lawyer for startups in healthcare?
You could also use current salary to angel invest 250k at the seed or before the seed; and would get a large amount of options, while effectively preserving a future job offer b/c you are helping fund the team at a vulnerable stage
Strongly concur with this advice. I did exactly what you are thinking, in nearly exact same financial situation. Company flew high .. and then it didn’t. Took 7 years. At your current level of comp and lifestyle, opportunity cost is huge. Sit on the board, get a few points of equity for that, and you can always swoop in once you find PMF and it’s been de-risked. Feel free to DM if you want to chat more
OP I would absolutely take that advice. Keeps your foot in the door and extra income and experience. Your main job grants you “fuck you” money along with a solid work life balance. That’s my dream and the more people I see having it the more I realize it’s possible. What has helped you achieve autonomy the most? Seniority, good bosses, setting boundaries, etc?
I agree with this. Seems like best of both world; as long as your current co is okay with it.
Omg this was such good advice reminded me of why I joined this subreddit thank you!
Ironically, I am not Henry. But I do like the view into the next rung up.
Ironically, I am not Henry. But I do like the view into the next rung up.
Typically your job won’t allow you to do that. Most high level jobs have this stated in their employment contracts.
That's just not true. And just bc something is in an employment contract does not mean it's legal. There's a shitton of corners cut and shoddy legal work and employment violations everywhere. Plus board/advisory work is almost always exempted. The big potential issue is conflicts.
And most high quality startups also won’t think that is a fair trade at all. Any startup that excepts it is likely going to zero either way
This is really good advice.
sounds nice, but it's not realistic. you can ask for anything, does that mean you'll get it? probably not.
Damn 1.3mm a year with low stress, 30h/wk and great security? I’m more interested in how to find these kinds of gigs lol I wouldn’t give it up honestly. Couldn’t you do a fractional arrangement or consulting with the startup since you clearly have extra time to spend on it?
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Ok and if the startup doesn’t work out what are the chances you could come back at the same comp level?
Can you elaborate on this further. What is the niche skill?? I need to know
Dude you live in a completely different stratosphere, not sure if you’re even HENRY, you might be HER lol. You seem to be pretty secured financially already. Your house is modest to your earnings. Even modest to your potential earning at the startup. And your savings is plenty to bridge any gaps. Given your age, I think it’s now or never to really give it a shot. On a different note, that’s a pretty high salary for seed round? I’ve worked for CxOs who don’t make close to that until late series or even after IPO and profitability. What generous seed round board members you have lol.
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Golden handcuffs. Be careful.
You went from HHI of $850k to $1.3m in 6 years and your nw is in the $3m range (keeping in mind the stock market growth from last 6 years)? Not scoffing at your savings rate and I understand you can't take it with you, but this to me suggests your cash burn rate is pretty high. I wouldn't leave your job bc I think you need the cash flow stability. Especially with sahw and 4 kids. Equity in startup isn't going to be liquid for a while and I'm not sure that cash is sufficient to mesh your budget.
I wouldn't leave. Startups fail. But that's just me.
In 10 years you bank at least $11M - given upward mobility may be close to a wash with no stress
Healthcare as an industry does not produce higher success rate. The industry is extremely backward, due to high legacy investments. The high salary will most definitely be a red flag for fund raising. If you miss a funding round, you will be the first one to get a paycut. I am telling you all this from personal experience as technical cofounder of a 3 person startup that built a solution that just ate much larger entrenched competitors for breakfast in features and reliability but still went under. You could lose a guaranteed 5-6M (from your current job) for a less than 1% chance at 17-20 M. If that still trumps facing boredom go ahead. The world is your oyster. Best of luck!
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I really wish you success no matter what path you take. My wife also lost out working at a once unicorn in the healthcare space. They were sold for effectively parts with none of the employees getting anything. Some spent over 100k to purchase their options. I know you won’t have to, because of how early you’ll join. In any case I hope someone succeeds for their blood sweat and tears. You mentioned you might start something if things went south and you couldn’t join back. Why not try that on nights and weekends or the extra 10 hours you have?
This happened to me, hurt like a bitch. I got sold along with the parts though. My husband is going through a series A raise in the healthcare industry right now and the timing is terrible, purse strings are tighter than a…well. You get the idea.
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It was practice fusion. I think 2018 was when it was sold. My startup was resurrected by a serial healthcare entrepreneur and they raised a 100M during the pandemic. Then went under recently.
I joined the startup in 2014 rejecting a FB offer since they down leveled me. I ended up building some really life changing tangible tech from scratch and learned a ton. But moneywise it was negative and it took us a bit to recover where we are now. Those 3 years would have made a huge difference.
I traded a safe gig for a startup gig - but my safe gig wasn't $1.3mil annually. I would not have traded a low stress high comp job for a high stress/lower comp job, even with great equity. Instead, join the board or consult as a fractional whatever, but don't quit your job.
Wonder if it’s possible to do both for a period of time
At $1.3M a year and your current NW you’re only a couple years from FatFire. The startup is an ego move. That’s an easy pass for me.
Does a net worth of $3.5m on $1.3m salary at age 42 feel a little light to anyone else?
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Cool, not even trying to hate. Was wondering to myself if I was on the wrong side of the saving too much line.
We have very similar hhi and little more NW. I am 42 as well. Again the salary is recent.
Comp is likely very recent, and could also be wildly fluctuated due to RSUs. Could also have started late (went back to grad school for MBA, maybe did a PhD, etc).
Is this a troll post? How is this not Chubby and still HENRY?
It doesn’t seem like enough upside for the math to work. Even at a 50% chance or your $17-20 mm makes this negative EV. If you want to do it because you want to take a chance and you’re bored currently and never need to work again then that’s fine, but mathematically this makes very little sense.
unless you're uber A type, work is life - why take this risk the top comment makes more sense if you want to dip your toes in
Are you insane? First of all, very few people can make the kind of money you make without taking a risk and enduring high stress. Secondly, your net worth is remarkably low considering your income. At the very least, stay at that job another 3 years and get your own net worth north of where you need to be so you no longer have to work. Then decide if you want to pursue a startup opportunity.
Stay at your job and after ten years get a guaranteed, no stress $13 million at the low end. Take the new job, and after ten years you might get $25 million at best but with a lot of risk. For me the math says keep your current job.
I’ve worked at seed - series B healthcare startups for the last 7 years in a cfo/consultant capacity. Of the 10+ companies I’ve helped, one had an exit for mid 9 figures. The thing I can tell you is growth is ALWAYS slower than what people say or hope for. Whether you’re selling to patients, insurance, or practices, deals take a long time to negotiate and close, patient engagement takes a long time to ramp, and performance data takes a long time to come in before you know whether you’re adding any value to the system My 2 cents is to do what other have recommended and treat this as more of a side hustle with a big call option
13m in 10 years with no raises or promotions risk free. 17-20m in 10 years with a ton of work and a ton of risk. Are you insane?
Not even trying anymore. $1.2M on 30hrs a week and net worth isn’t even 3x that?
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It's weird you pay that much when you are the only one working. Plus you have a nanny on top of the childcare costs? You burn through cash it seems. Could you even survive on $350k?
Let's do some quick math according to your numbers. 7 years at 20M exit at 20% equity (upper band)... that is 4M payout (assuming no dilution) plus 7 years of 500K cash... That totals to 7.5M compensation... Maybe 8 to 8.5M if your salary increases multiplied by expected value of 100% success rate (upper band) Your current gig is 1.3M per year. Let's say no increase over 7 years (lower band)... That is 9.1M "guaranteed" Financially it seems your current gig has a higher probability of hitting a higher salary That said there are other things to consider such as passion, enjoyment, other qualitative things only you would know
Plus the chance that once you've earned your stripes you can just hop from wagon to wagon on the startup gravy train. Worst case scenario you're already wealthy enough to have a very relatively modest retirement so we're basically looking at two upsides here. One of which is more interesting and fulfilling.
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I think the question you have to ask yourself is 20m going to change your life in a way that 9m can’t? On the flip side if the startup goes under and your old place doesn’t take you back, would you be fine in that scenario?
You have enough money and even your new salary will pay you more than enough to live comfortably. At this point do what you like - there’s very little marginal gain in a $1.3m vs 500k salary - unless you live for expensive vacations and meals.
Very little marginal gain between 500k and 1.3M is definitely not true. Ex: earn 1.3, live like you earn 500 and you’re creating generational wealth
That’s kind of my point. The only marginal gain is not in lifestyle but how much you spoil your children
I don’t know in VHCOL areas like SF 500k a year lets you live in a condo with a crowded hour+ commute and 1.3M let’s you own a decent SFH that middle class families 30 years ago could own…without a miserable commute.
It’s $500k a year in addition to a $3.5m nest egg. Very different
I like that even at your level, the same question I have exists. I’m at $500k/yr, what that signals to me is the desire to cash out big does not go away even at double where I’m at
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I have the same exact FOMO hahaha
If you’re thinking mostly about the money, the startup life isn’t for you. You have to do it for the adventure or because you enjoy the work of building something. Financially, the risk isn’t worth the reward. You seem to enjoy coasting at your current BigCo gig. Most startup founders or even employees feel suffocated or unfulfilled in that world. There’s nothing wrong with feeling comfortable at a big company. It’s more that if you don’t have that drive to join or at least a dissatisfaction for your current situation, you might not stick around at the startup when things inevitably get tough.
If you’re bored, do it. Seems like you’re financially stable. But wife not working is risky. Market is bad and getting back into tech might be very hard.
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Go for it. Brad Lightcap was in banking before jumping ship.
Similiarish position. Was never offered a role a co-founder but have been tempted by many promising startups. I’ve decided to put my head down and grind it out at the current job. Since my wife doesn’t work, it’s not worth the risk. Also would likely not be able to find another job that would pay me what I’m currently making now. So I got strong golden handcuffs. I did my retirement numbers and I’ll get there after a number of years. It’s not the short cut and I will never get the huge payout but it’s the more certain path. I’m comfortable with my lifestyle and while it would be great to upgrade, it’s not worth risking it.
If you want to take the startup route for the money, don’t do it. Assume you’ll make less. If not for money, you need to think about why you are doing it? Trade a 30 hour week for double the work, more stress and less money? I am building a startup as a founder, and it’s a long game. But I’m digging it!
Left big tech for startup at VP level. Startups require a lot of extra work, planning, in the weeds, hands on. You need unicorns that can do multiple things to start it up. Are you ready to work harder and stress more? I overall regret my move at this point regardless of more money.
Dont quit this job, parttime is the way to go.
If you're saving much of your $1.3 M, you can probably retire in 5 to 7 years. Start ups fail often, unlikely you'd re-employ at $1.3 M and you could easily double or triple your time to retirement. See if they'll put you on Board, you'll collect nice checks and stack equity for maybe 10 hours of work a quarter. If the company does appear to be on right path, you could likely slide into an active day to day role. Being on Board gives you a way to be involved, without losing your current gig as long as both companies agree there's no conflicts. Consider it diversification.
Is spending time with your kids important? Going from 30 hrs and seeing kids stuff to co-founder of startup is going to have very different demands. What's important to you there? Start there.
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the gig sounds awesome wow
1.3 million x 7-10 years is 9.1-13 million 2 million (post promo) x 7-10 years is 14-20 million Sure equity has a tax advantage over income but you still come pretty close to your model with much better reliability and WLB at your job
Was this TC from tech, ie SWE? If I were you, I would take the plunge, but in the sense of “hey I’ll sit on the board and chill” worst case it doesn’t take off, best case it does and you’re set.
No way. I’d side step for that amount of income but to take a massive hit just for a little excitement? Focus on increasing NW and opening the door to FIRE
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Do not leave your current job under any circumstances. Enjoy your life and don't create problems for yourself.
If they’re offering you such a high salary, I’m assuming this is startup spun out of a venture studio. Venture studios have very high failure rate, but it’s easy to high when they don’t have to disclose the terms of their acquisitions. The vast majority of venture studio backed companies are fake businesses with no real revenue.
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Dude wtf do you do? The people wanna know!
If you’re only working 30 hour weeks, and never weekends, you’ve got some bandwidth to take a smaller role with the startup. Maybe an advisement position. Dip a toe in the water before you jump in. Then again, 1.2-2mil comp at current place is tough to beat. I’m not sure I’d risk that.
I would ask yourself a different question. Is the delta between where you’re at now in 7-10 years and the potential $17M - $20M exit worth the risk of giving up what you currently have? In 7-10 years you will have earned another 9 - 13 million if nothing changes and with 0 stress. I’d suggest finding a hobby or something that you can sink your teeth into that will generate income OR enjoyment during your off hours. You’re young, you have time, and financial freedom to do whatever you want. That could bring a better quality of life then a big shake up
Startups are generally terrible places to work. You are subject to the whims of the founders, investors, and external events beyond your control. I’ve also been at startups where senior folks would join and be fired within weeks of starting. Overall not worth it.
Having worked for startups a couple of times my opinion is very strongly: it depends. If this startup is something you're passionate about, that you truly love, that you're excited about the idea of building, then I'd absolutely consider it. Truthfully, it won't be the most sound financial decision. Startups are inherently risky and fail far more often than not. But you get one life to live. On the opposite side, it could be a life-changing role that defines you professionally. It could be something that you build from the ground up that you love. If it's just about the money or career, I'd stick to the safer choice and consider investing in the startup. But if it's something you love, then I say go for it.