Equity? No, thanks
If I got a dollar for every equity offer, I’d be a rich man. If I accepted being paid with equity-only, I’d be a broke man now.
The above statement, even supposed to be humorous, depicts what being paid with equity-only, in new and exciting ventures leads to. Everyone has that awesome idea and is going to establish the next Google, Facebook, Amazon or Whatsapp – combined.
From motivational aspect, there’s nothing wrong in having high hopes. In fact, it’s awesome – for them. But for you, the only answer is no, thank you. If you don’t feel comfortable saying ‘no’ to such offers, you might want to learn that.
There are numerous reasons to turn down such offers, but they all come down to one predicate – you’ve got to live. If client can’t afford a decent, possibly discounted designs for a new project, we all know what the future holds for it. Just because it’s online doesn’t mean it’s going to be a huge success.
It’s critical to let everyone know you are not a venture capitalist. You are not supposed to believe in anyone’s ideas by default. You are nobody’s business counselor, either.
There will be days when client approaches you and asks for honest opinion of what she’s building. Will it rock? You don’t know that, the only thing you know is how to create amazing designs for it. The rest depends on her team and ability to develop it and market it. Crazy as it seems, many opinion-seekers seem offended if your answer isn’t aligning with what they want to hear.
Way too often clients expect us to have faith in their dreams. Those are their dreams, not ours. At least it takes some time to do a basic research in order to know what they’re talking about. Yet, they expect us to have all the answers instantly, like we have a magic 8-ball in our hands.
Opposed to broke entrepreneurs are the ones who actually have money, but simply don’t feel like paying for your scribbles. We are just doing a decoration, anyway. As a matter of fact, we should pay them to have our artwork featured on their next Google. The only difference between them and genuinely broke people is the arrogancy of the former.
Either way, you’ll be offered a stake in success or failure. Only worse payment model is the we pay when we grow method, which translates to we won’t pay, ever. You’ll be offered double or triple your standard rate, just wait until she’s a success.
To keep your sanity, calmness and finances in order, you should run like mad from such offers at first sight. You could turn down next Bill Gates, Steve Jobs or Mark Zuckerberg, but it’s totally fine to live with that fact. Odds are similar to winning a lottery – if only you had bought that ticket, right?
24 February 2014