> startups try to have very small option pools after their A rounds, because the dilution only comes from the founders and not the investors in most A-round term sheets.
Why is this the case? If you try to align the interests of the investors with the interests of the founders, you'd find that this would put you at odds with your investors.
A company's total value might be quite a bit higher by having the ability to offer large amounts of employee options (just as an example, the ability to easily hire media personalities with a big followings without breaking your bank), which is good for both the founders and the investors.
I understand the investors are trying to protect themselves from the founders deciding to give a ton of shares to their friends (and then potentially back to the founders, in other ways), but I wonder if there is a better solution to this.
Why is this the case? If you try to align the interests of the investors with the interests of the founders, you'd find that this would put you at odds with your investors.
A company's total value might be quite a bit higher by having the ability to offer large amounts of employee options (just as an example, the ability to easily hire media personalities with a big followings without breaking your bank), which is good for both the founders and the investors.
I understand the investors are trying to protect themselves from the founders deciding to give a ton of shares to their friends (and then potentially back to the founders, in other ways), but I wonder if there is a better solution to this.