Thanks for reading our shorter blog post: Bull's Eye - Negotiating the Right Job Offer. This is the full Q&A between Mary Russell and Boris Epstein. It’s long, but it’s full of lots of insights on how to negotiate the right compensation offer from a company.

Mary Russell counsels individual employees and founders to negotiate, maximize and monetize their stock options and other startup stock. She is an attorney and the founder of Stock Option Counsel.

Boris Epstein is the founder of BINC Search, a next-generation recruiting startup that helps Silicon Valley companies hire technical talent at the scale they need.

Mary Russell, Attorney @ Stock Option Counsel: Welcome, Boris. I’ve always enjoyed our discussions on compensation negotiations because you seem to believe that a candidate and a company can discover a “right offer.” Employees who come to me for Stock Option Counsel want to get to that “right offer” for salary and equity, and I’m happy you’ve joined us to share your perspective on how to get there.

Boris Epstein, Founder @ BINC Search: Thank you. I think there is a right offer in a compensation negotiation, and companies and candidates arrive there by identifying four data points:

1. The candidate’s Past Comp

2. The Peer Comp of the candidate’s level within the company

3. The candidate’s Desired Comp and

4. The Market Comp or competitive scenarios in the market

The epicenter of all the different data points would be what they would arrive at to get a right offer. So if all four numbers align, it’s really easy. If the four numbers are divergent in some way, then someone’s going to have to make tradeoffs and concessions. If the person’s making $100,000 but then they want $200,000, and market’s $150,000, someone’s going to have to make a tradeoff somewhere to arrive at the right package.

READ LOTS MORE ...

Kurt Vonnegut, Author

If you are a founder with some suspicions about the motivations and allegiances of your company's law firm, you may appreciate the wisdom of Kurt Vonnegut.

Vonnegut has a great bit in God Bless You, Mr. Rosewater about the worst motivations of corporate lawyers.

The book is about money, sort of. Here's the opening line:

“A sum of money is a leading character in this tale about people, just as a sum of honey might properly be a leading character in a tale about bees.”

— Kurt Vonnegut, God Bless You, Mr. Rosewater

The Rosewater family had a great fortune. It was held by The Rosewater Foundation, for the benefit of the family's heirs, and managed by a law firm called McAllister, Robjent, Reed and McGee. An associate of the firm, Norman Mushari, was Vonnegut's embodiment of the worst motivations of corporate lawyers.

“No one ever went out to lunch with Mushari. He took nourishment alone in cheap cafeterias, and plotted the violent overthrow of the Rosewater Foundation. He knew no Rosewaters. What engaged his emotions was the fact that the Rosewater fortune was the largest single money package represented by McAllister, Robjent, Reed and McGee. He recalled what his favorite professor, Leonard Leech, once told him about getting ahead in law. Leech said that, just as a good airplane pilot should always be looking for places to land, so should a lawyer be looking for situations where large amounts of money were about to change hands.

”In every big transaction,” said Leech, “there is a magic moment during which a man has surrendered a treasure, and during which the man who is due to receive it has not yet done so. An alert lawyer will make that moment his own, possessing the treasure for a magic microsecond, taking a little of it, passing it on. If the man who is to receive the treasure is unused to wealth, has an inferiority complex and shapeless feelings of guilt, as most people do, the lawyer can often take as much as half the bundle, and still receive the recipient’s blubbering thanks.”

— Kurt Vonnegut, God Bless You, Mr. Rosewater

Vonnegut's wisdom is a good reminder to founders that their company's attorneys may be representing the company's money rather than its founders.

Stock Option Counsel provides personal counsel to founders to protect their individual interests. At incorporation, we review the company counsel's documents and provide founder-friendly terms. At financings and mergers, we train founders to help them master the deal terms so they can identify and negotiate for the terms most favorable to them as individuals. For more information, see the Stock Option Counsel website or call us at (650) 326-3412.