Startup Hiring & Equity
How Much Equity Should You Give Your First Hires?
A Founder’s Guide with U.S. & European Benchmarks
Equity is one of the most powerful tools a founder has — but it’s also one of the most misunderstood. Here’s what the data shows about early team grants in 2024, and how European norms differ from the U.S.
“How much equity should I give my early hires?”
It’s one of the most common — and emotionally charged — questions I hear from founders.
You want to be fair. You want to attract the right talent. But you also don’t want to give away too much too soon. And in early-stage startups, compensation isn’t just about cash — it’s about belief in the long game.
So let’s start with some real data.
U.S. Equity Benchmarks for Early Hires (Carta 2024)
According to Carta’s latest report, here’s the median equity granted to the first 8 full-time hires in U.S. startups (based on 4-year vesting with a 1-year cliff):
• Hire #1 → 1.5%
• Hire #2 → 0.85%
• Hire #3 → 0.5%
• Hire #4 → 0.44%
• Hire #5 → 0.33%
• Hire #6 → 0.27%
• Hire #7 → 0.25%
• Hire #8 → 0.22%
What this shows:
• Even your 8th hire is getting meaningful ownership.
• Top-performing startups often give more — especially to hire #1.
• Equity is belief in your vision, not just compensation.
How This Compares in Europe
If you’re hiring in Europe, things look a little different — and you’ll need to adjust accordingly.
1. European Equity Ranges Are Lower
• Hire #1 → 0.5% to 1.0%
• Hire #2 → 0.25% to 0.5%
• Hire #3 → 0.1% to 0.3%
In most EU markets, equity is less familiar and often viewed with caution.
2. Legal Structures Vary
Here are common formats by country:
• UK: EMI options (tax-advantaged and widely understood)
• France: BSPCEs (standardized, attractive tax treatment)
• Germany: VSOPs (phantom shares, easier legally, less transparent)
• Switzerland: No standard approach — requires custom legal structuring
Make sure you localize your equity offer and explain it clearly. Most hires outside the U.S. won’t assume equity is part of the deal unless you position it well.
3. You Need to Sell the Vision (Harder)
In the U.S., early hires expect equity. In Europe, many don’t fully understand its value — or they’ve seen it used badly. You’ll need to educate and inspire.
Equity Alone Won’t Close the Hire
You can’t out-equity a poor pitch.
Even great equity packages won’t work unless people:
• Believe in the product
• Believe in the team
• Trust the founder’s vision
Use equity to build ownership — not just incentives.
Final Thought
Early equity isn’t just a number — it’s a message.
It says: You matter. We’re building this together.
If you want a team that behaves like owners, you need to treat them like owners from day one — with aligned incentives, clear communication, and an inspiring mission.
And if you’re hiring across borders?
Global best practices are helpful — but local execution is what wins.
Curious how your equity offer stacks up?
We can review your hiring plan, model dilution scenarios, and align your cap table for growth.