PartnerGuy

VP Channel Sales

Stock Options or Higher Base?

My fellow sales folks and I are having this debate a lot so opening it to the wider community...

Personally I'm at a point where my base hasn't increased much as I'm not moving around, but I'm more than fairly been compensated in company shares, like a stupid amount. My concern is that we can get locked into RSUs and forced to stay, when I could go elsewhere and get a much higher base. If I do I lose the RSUs as they're vesting over a 3 year period, knowing well that when they vest they'll give me a load more starting the cycle again.

It's not a complaint, but I also don't want to get locked into a place. I like to do good stints at companies and not move around every 1-2 years, but I don't also don't want to feel trapped.

So the questions is really do you go for the cash in the bank, or more money that'll vest over a period of time (which in itself is a gamble on the stock doing well)?

Company Stock or Higher Base?

Attached poll

Stock Higher Base

*Voting in this poll no longer yields commission.

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3

9 comments

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Don_Ready

Politicker

1

AE

Risk vs Reward. If it's a high-growth org with a ton of potential why would you limit yourself to just a base and in most cases that's not even an option with smaller faster moving companies. But if it's a well established org that sees minimal growth YoY; higher base, trust yourself to invest and make more at that point.

brotato

WR Lieutenant

1

Head of Sales

First off, the idea that equity is tenure based instead of performance based for sellers is stupid. Why do you need to hang around 4 years to get your shares?

They want revenue and you deliver. It's not hard to negotiate the equity vests based on revenue milestones that you achieve.

Secondly, equity is commonly, heavily diluted by the time an exit event occurs. So while it's important to secure good equity that is performance based, a seller should always negotiate for cash.

Base pay, accelerators, bonuses, education stipend, perks (like travel, home office, food), etc. I've negotiated before as the first sales hire that if I hit the made up quota number they gave me that I be awarded a flat $30,000 bonus check. There's no rules to this.

Be creative, and definitely don't get trapped.

overheard_sales

Politicker

1

CEO - Overheard_Sales

Nothing is guaranteed like a sweet sweet higher base

beerisforclosers

Politicker

1

Account Manager

I'm not sure I properly appreciated the reassurance of a base until this pandemic hit, but nothing beats that guarantee!

sales101

WR Officer

1

Head of Channel & Alliances

Something to keep in mind here is the size of the industry you’re in. I am a huge fan of options/RSUs but it depends on how long after/before an IPO you’re joining, and also how large the market can get. If you’re in very niche, small industry where your business can only hit a certain value, or if your business is not constantly innovating but happy with their core product, it means that the share price will eventually plateau.
Equity is definitely important to have but there’s such large risk (and usually tax) involved, so imo, I’d really weigh up the options befofe sacrificing any base salary.

CaneWolf

Politicker

0

Call me what you want, just sign the damn contract

I get asked this question a few times a year by former SDRs/BDRs and friends of friends. My response is always the same. Would you take the job for that comp without the options? Because the reality is a shitload of the companies giving the amount out that will actually matter are going to fail.

slaydie

Big Shot

0

Account Executive

Higher base for sure. I've drank the kool-aid of equity and sure it's great if it all works out but they more often turn into nothing than something. That sweet sweet base is where it's all at, definitely much more helpful in pandemic type situations than having equity that you can't do anything with.

Moneymachine

Politicker

0

Account Executive

Don't forget to throw in a car allowance

CuriousFox

WR Officer

0

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