Many founders ask us, after the option pool has been set up and allocated to individuals, how are the options to be allocated to different employees? Is there any reference standard? We generally think: the first employee (usually the CTO of the company)

, which is a technical investment), a maximum of 2.0% - 3.0% of options will be allocated.

We have also seen statements of 2.0%-4.0%. The difference in the floating range is not too big. The average value is generally 1.19%.

The first 2 to 5 employees will be allocated a maximum of 1.0% - 2.0% options. The role of this type of engineer may belong to the technical lead, which is also a relatively powerful role.

First 6 to 7 employees: 0.5% - 1.0%; First 8 to 14 employees: 0.4% - 0.8%; First 15 to 19 employees: 0.3% - 0.7%; First 21 to 27 employees: 0.25% - 0.6

%; first 28 to 34 employees: 0.25% - 0.5%.

The above reference values ??are all maximum values ??and are a capped concept.

For example, the first 19 engineers recruited can receive options of 0.3% - 0.7% at most. They are ideal talents that are very suitable for the company. They have many years of work experience and belong to the Senior Level.

, he is someone who can lead a team when he goes out.

If you are recruiting an industry recruit who has just graduated from college or does not have much relevant experience, the option ratio given will be far less than the standard mentioned above.

There is even less data available for reference in this part, so the conclusions drawn can only be briefly referenced. The actual allocation ratio still needs to be adjusted specifically according to the industry in which it is located.

VPs in the sales department are generally given options between 1.0% and 2.0%, directors are within the range of 0.5% and 1.0%, and positions below the director generally do not exceed 1.0%.

The first 10 employees are usually given options between 0.3% and 0.5%, and for those who join later, this ratio will be reduced to 0.1% and 0.2%.

There is less job data for VPs in the marketing category and it is difficult to draw conclusions.

For director-type positions, in companies with less than 15 people, options are usually allocated at 0.5%-1.0%; in companies with more than 15 people, options are usually allocated at 0.25%-0.5%.

The top 4 employees in the UI/UX design category will receive options of 1.0-2.0% at most, and occasionally 0.5%.

If 5 designers are recruited from outside the company, they can get options of 0.5%-1.0% at most.

After that, 0.2%-0.5% of options will be allocated to the top 10-30 employees.

For this part of non-engineering positions, the survey sample is too small to draw representative conclusions and is for reference only.

The general principle is that employees who join at an earlier stage bear more risks and receive a greater proportion of options; employees who join at a later stage bear much less risk and pressure, and are allocated a smaller proportion of options.

But this is not a conclusion.

When companies and employees negotiate salary packages, they often make comprehensive considerations based on the employees' qualifications, experience, and abilities.

Some employees hope to get more cash returns, take more salary, and sacrifice a small part of the options, which will be more attractive to this type of employees.

When allocating options, the most important point is that the company has good communication with its employees.

The original intention of start-up companies to issue options is also to motivate employees so that they can create greater value for the company.

The above-mentioned parameters that are relatively common in the market are also for the company to have a comparison when allocating options, so as not to be too generous or too stingy.

In the former case, there may not be enough equity for investors in the next round of financing.

In the latter case, employees may feel that they are not valued by the company and that their efforts are not recognized by the company, thus losing the motivational effect or even creating negative incentives.

Therefore, good and transparent communication with employees is the top priority when implementing equity incentives.