The Direct Answer — what equity decision is most urgent?
Sort cofounder vesting before your first investor conversation. A cap table without founder vesting is a red flag that stops deals — investors won't commit if a cofounder can walk away with their full stake on day one. Get a 4-year vest with a 1-year cliff signed between cofounders, then turn to everything else.
Foundational Concepts
Cap tables, dilution, and the mechanics of ownership
Why it matters
Before you make any equity decisions, you need a solid grasp of the underlying mechanics — how cap tables work, what dilution means in practice, and how option pools are structured. These Carta resources cover the basics every founder should internalize before their first grant or term sheet.
Carta resources
- What is a cap table?
A plain-English primer on cap table structure, who goes on it, and how it changes over time.
- Equity dilution explained
How dilution works with every financing event and why it doesn't always mean losing value.
- How option pools work
What an option pool is, how large to make it, and how it interacts with your cap table.
- Fully diluted shares — what counts
Understanding fully diluted share counts and why investors use them to evaluate ownership percentages.
- Common vs. preferred stock
The key structural differences between common and preferred shares, and why it matters at exit.
- Carta's equity glossary
Definitions for every equity term you'll encounter — from vesting cliffs to liquidation preferences.
Cofounder Equity
Splitting equity fairly — and protecting what you build
Why it matters
Cofounder equity splits are one of the most consequential decisions at a company's founding. Get it wrong and the conflict surfaces at the worst possible moment — during a fundraise or after a cofounder departs. These resources walk through how to approach the conversation, what vesting schedules to use, and how to protect the company if things change.
Carta resources
- How to split equity between cofounders
A framework for thinking through fair splits based on contributions, risk, and commitment.
- Founder vesting schedules
Why founders vest too, what a standard 4-year/1-year cliff looks like, and when to deviate.
- Founder agreements and equity protection
What should be in a founders' agreement and how it protects all parties if a split happens.
- Equity buybacks and founder departures
What happens to unvested shares when a cofounder leaves, and how repurchase rights work.
C-Level / Executive Hires
Market-rate equity for your first executive team
Why it matters
Hiring your first VP of Sales, CTO, or CFO from outside the founding team requires a different equity calculus than cofounder splits. You're benchmarking against market comps, thinking about seniority, and balancing cash versus equity tradeoffs. These resources help you set packages that attract top operators without giving away more than necessary.
Carta resources
- Startup equity compensation benchmarks
Data-backed benchmarks for equity grants by stage, role, and seniority — built from Carta's dataset.
- How much equity to give early employees
A practical guide to sizing grants across levels, with particular attention to early senior hires.
- Executive compensation packages
What a full executive package looks like — base, bonus, equity, and acceleration provisions.
- Double-trigger acceleration explained
Why senior hires often negotiate for acceleration on acquisition, and how double-trigger clauses work.
- RSUs vs. stock options for executives
When to use RSUs instead of options for later-stage executive grants and the tax implications of each.
Advisors
Structuring advisor grants that align incentives
Why it matters
Advisor equity is often the most informal equity a startup issues — and that informality leads to bad outcomes. Too much equity for too little contribution, no vesting, unclear expectations. These resources cover standard advisor grant sizes, how to vest them, and how to use an advisor agreement to set clear expectations from day one.
Carta resources
- How much equity to give advisors
Typical advisor grant ranges by stage and engagement level, with guidance on how to calibrate.
- Advisor agreements — what to include
The key terms every advisor agreement should cover: deliverables, vesting, IP assignment, and confidentiality.
- Vesting schedules for advisors
Why advisor vesting is shorter than employee vesting and what a 2-year monthly vest looks like in practice.
- FAST (Founder/Advisor Standard Template)
The FAST agreement is the standard template for advisor equity — what it covers and when to use it.
All resources link to Carta's public documentation. Equity decisions have legal and tax implications — consult a lawyer before issuing grants.