Working at a startup is overrated, both financially and emotionally

Re:Working at a startup is overrated, both financially and e... by rahulpadalkar on Saturday May 22, 2021 @12:17PM (#27247953)

> Say you have a 2% chance of picking a unicorn and being a member of the founding team. That 2% is honestly way too high for most people, and perhaps a bit low for others, but a good median to anchor on. $10M * 2% = $200K. And realistically you’re only going to get that this tranche of equity every 3-4 years at most, so that’s a risk-adjusted value of $50–$66k.

I didn't understand this math, 2% is the chance of it being a unicorn. 1% of 1B is 10M is the amount you might get if the startup sells for 1B. what does 2% of 10M signify?

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Re:Working at a startup is overrated, both financially and e... by luca3v on Saturday May 22, 2021 @12:30PM (#27248060)

$200k is your expected equity payoff if you have a 2% chance that your equity is going to be worth $10M and a 98% chance that it's going to be worthless, which is the simplified model used in that back-of-the-envelope calculation

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