Negotiating Equity without Private Equity Experience

A Simple Model · Beginner ·💰 FinTech & AI for Finance Professionals ·2y ago

About this lesson

How can I negotiate an equity position when you don't have a private equity background? This is a question I receive frequently from ASM subscribers and people working at private companies. This video is intended more for lower middle market businesses, but I believe the advice applies for much larger businesses. Generally, with the latter, there may be a lot more structure that surrounds the process, but certainly not always. Equity compensation is an incredible way to build wealth. If this sounds like too much work, take the time to understand the economics. With the right opportunity, the results may surprise you (and even change your life). Also, if equity compensation is offered, don't put the conversation off. Too frequently I hear people say that "they can figure that part out later."  You may look back later and realize that the opportunity was lost. You get what you negotiate! Link to Post: https://www.asimplemodel.com/insights/negotiating-equity-in-a-private-equity-transaction Distribution Waterfall: https://www.asimplemodel.com/insights/distribution-waterfall

Original Description

How can I negotiate an equity position when you don't have a private equity background? This is a question I receive frequently from ASM subscribers and people working at private companies. This video is intended more for lower middle market businesses, but I believe the advice applies for much larger businesses. Generally, with the latter, there may be a lot more structure that surrounds the process, but certainly not always. Equity compensation is an incredible way to build wealth. If this sounds like too much work, take the time to understand the economics. With the right opportunity, the results may surprise you (and even change your life). Also, if equity compensation is offered, don't put the conversation off. Too frequently I hear people say that "they can figure that part out later."  You may look back later and realize that the opportunity was lost. You get what you negotiate! Link to Post: https://www.asimplemodel.com/insights/negotiating-equity-in-a-private-equity-transaction Distribution Waterfall: https://www.asimplemodel.com/insights/distribution-waterfall
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