Guide: How should a start-up company allocate equity? The general criterion is that whoever is the most important should have the most shares. For example: product team, engineers take the most shares. Business type, sales partners take the most shares. Business model type, those who will finance should take the most shares.

There is an article circulating on the Internet about how start-ups allocate stock options. It says that the general distribution principles of Silicon Valley are as follows: 1. External CEO: 5% to 8%; 2. Vice President 0.8% to 1.3%; 3. Front-line managers 0.25%; 4. Ordinary employees 0.1%; 5. External board directors 0.25%; 6. Options account for a total of 15% to 20% of the company's shares. Option work starts after 1 year and ends in 4 years. Only when the benefits are distributed fairly can a combat entrepreneurial team be formed.

Obviously, the distribution principle of Silicon Valley does not conform to the actual situation in China. Not to mention that hiring an external CEO is not reliable at all, start-ups find a CTO or CMO, and only give 0.8% to 1.3%, and it is estimated that no one will do it. The market situation is that CTO often costs about 10 points. And options, basically except that the company has to be transformed into a joint-stock company at a certain stage of development and is ready to go public, are basically like waste paper for ordinary employees. It is better for the boss to give more bonuses, or the boss to award a best employee in front of the whole company's employees.

So how should Chinese-style equity be allocated? In fact, the principle is very simple. Entrepreneurs need to figure out who is the most important person in the company besides the founder? Whoever is the most important person will take the most shares. If the company is a product-driven team, the engineer product manager should take the most shares. If it is a business type, the sales partner will take the most. Business model type, which requires upfront burning of money, will raise the most shares.

The most typical example of a product-based team is an online game. Those who make games almost don't have to think about anything else, and they are completely focused on the product. The product is good, the user loves to play, and the channel will take the initiative to contact you. Developing games is useless if there are too many people, and it is useless if there is too much money. Throwing money at the office is useless on the scene. Instead, it is better to work together with seven or eight brothers in a three-room, two-hall. Cao Kai, the CEO of the Dancang Hall, works until 12 o'clock every day to see the various problems existing in the game after the game has earned 10 million yuan per month.

Sales teams often rely on customer orders to survive. Even if they want to transform into product teams, they often rely on outsourcing to survive in the early stage. In this case, whoever can bring sales is the best.

Business model teams often burn money in the early stage, or even burn money not millions, but tens of millions, hundreds of millions. The currency unit is not RMB but US dollars; then whoever can raise money should take big benefits. For example, an Internet company that a friend helped a brother raised 8 million RMB from the Wenzhou boss last year when the capital markets were already very poor. The valuation reached 100 million RMB, and the product was not even launched. Brother gave him 15 shares, not full-time. Friend's full-time job is still investment and financing, and maintaining good relations with Wenzhou investors.

Many startup founders have big ambitions, and the team does not have talents like Guan Yu and Zhang Fei who are independent, but also wants to make platform-level products. When they come out to entrust financing consultants, they are only willing to give very little benefits; in the end, the financing fails, and the company goes bankrupt. This really echoes the words of the Dream of Red Mansions: The opportunity is too smart, and Qingqing's life is mistaken. In the process of enterprise development, different talents are required, and interests need to be allocated at any time. The most typical example is that Liu Bei conquers the world. In the early stage, Guan Yu and Zhang Fei; in the later stage, Zhuge Liang gains greater rights and interests. In order to maintain balance, Guan Yu is given the mission of a vassal. This is similar to when a startup grows and assigns a certain piece of business to an old member of a certain team to run, in exchange for his elimination in the management of the head office. These issues are not discussed in this Conclusion: What start-up companies want is savage growth. The detailed equity allocation method in the United States often doesn't work until the company reaches a large scale. The most important thing for start-up companies is to have self-awareness and distribute benefits in a targeted manner.