Equity Sharing Calculator
Work out how many shares to give to your team
Excluding co-founders, companies typically have a total share scheme pool of c. 10-20%. Of this, depending on the nature of the business and its development path, up to 10% may be for early key hires (eg CTO, CMO, CFO), with 10% then being earmarked for the balance of the team over time.
This article goes over the ideas here in a bit more details, so it might be useful to have it open alongside this as you work your way through.
The maths below assumes that the percentages you input are what the individual holds at the end of the process, once everything has been issued. This means that if not everything ends up being granted, those that did receive equity may hold a slightly higher percentage.
Once you've gone through the calculation, you will be able to download your results at the bottom.
This calculator makes some assumptions
Since it is not possible to issue fractions of a share, this calculator always rounds any fractions down to the nearest whole share.
To make it possible to grant smaller percentages, companies often subdivide their share capital, so that each share represents a smaller percentage of the total.
1 Current Shareholding
This section should include all the shares already in issue, though you can group shareholders if it’s easier.
2 Co-Founders: 10-70%+
These people might be there with you from Day-1, but this does not necessarily mean that they will all be equal shareholders. This depends on the amount of time and value each of them is willing to commit and contribute, to what extent they are receiving any income, as well as how much is actually delivered. Have a look at our article about setting up a dynamic equity split via an Agile Partnership to address this complexity.
3 Key Early Hires: 5-10% (1-3% each)
Although they are already “hires” rather than co-founders, they are crucial team members of the budding business, and are still likely taking a risk joining you on your journey when they are. They will probably form the C-suite of the scaling business in the coming years, and as such you want to make sure they have plenty of skin in the game.
4 Senior Management: 1-5% (0.5-1% each)
These people will be joining the company over the first few years as the broader team takes shape. They are joining a more mature, steady business, and might therefore be taking less of a risk than some of the earlier joiners. Nonetheless, they will be cornerstone individuals in the organisation.
5 Employees: 5-10% (0.05-0.5% each)
Although this might not look like much as a percentage, if the company journey goes how everyone hopes this may well be a significant payout down the line. Regardless, feeling like you are part of the game matters, and will go a long way with even the most junior employees as long as they understand how the scheme works.
6 Investors: 5-20% per round
If you’re expecting investment in the short to medium term, and have a general idea of the amount of equity involved, think about whether you want some of the people in the scheme to be holding their percentage before or after this investment. If you want them to be holding their percentage after an investment has come in, include it here.
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