05.09.07
Another panel discussion on corporate venturing
In case you missed my other speaking event, I am going to be on a SDForum breakfast panel June 5th to talk about how Corporate Venturing and Acquisitions play a role in the tech ecosystem and how this type of “investment” can foster innovation and transform technologies into scaleable businesses.
* Steve Bengston from PWC
* Jai Das, SAP Venture Group
* Lisa Lambert, Intel Capital
* Deborah Magid, IBM Venture Group
* Ray Wu, HP Venture Group
Click here for registration url
garageguru said,
August 4, 2007 at 3:47 am
Hi Mr.Wu,
This is out of the article’s content,but would appreciate your thoughts. I was wondering what your thoughts are on the stock options provided to an advisor in a very early stage venture. My tech startup has an advisor who has been in the same domain and brings in great value in terms of his network, prior experience and domain expertise. His commitment is approx 2 hrs every week for the first year. Tech and strategic inputs. No contributed capital. What do you think I should propose as stock options ? I read Feld thoughts and spoke to several others and the numbers have varied from
Ray Wu said,
August 6, 2007 at 9:23 pm
I don’t think there is a standard for this as company potential and adviser contribution vary significantly case-by-case. What you can think about is to structure an option package exercisable in 2 - 3 years, vested on a monthly basis that provide the right compensation level for your advisor’s time and energy. One way to do this is the following: assume your advisor hourly rate is $100, 2 hours a week x 50 weeks a year x $100 = $10,000, give it a risky factor of 1.5, you probably can give your advisor $30K worth of stock options for 2 years vesting. If your company’s valuation is $3M, that means 1% of the company fully diluted. Use your judgment on how valuable this advisor is compare to your team members and then determine what is fair.
garageguru said,
August 7, 2007 at 3:53 am
Thank you for your inputs . Yeah I was considering something on similar lines, with a component for the intangibles built into the opportunity cost. Since I would like him to play a more active role , I am looking at providing him an option to invest in a future event, so I would slightly scale the figure and propose a number that makes it attractive for him. Thanks again!