Got an appraisal recently, but I kinda feel scammed

[purposedgrace]

I work in a early stage startup (15-20 employees). Last month I got my first appraisal. We have started to acquire a decent number of clients and it is increasing every month. But we still haven't reached the breakeven. The CEO said that we have a runway of 7-8 months but if we can acquire a certain number of clients by then, then we may reach the breakeven. So, he held a meeting with me 2 weeks back to discuss about the appraisal. He said that the company is giving me almost 30% hike and 5 lacs worth ESOPs. And then said that both my salary and ESOP will be added up as my current CTC which means that my annual salary is around 5.4 LPA and 5 lacs ESOPs will add up and my CTC will be 10.4 LPA. I don't know how is it going to affect my future job hunt, whether ESOPs will be beneficial for me (vesting period is around 3-4 years), OR should I ask them to just show my salary as CTC, etc. Infact, I feel that they have done this just to keep me longer in the company. Help me get some clarity in this situation.

 

[godsgirlxo]

@purposedgrace Runway of 7 months are you are worried about appraisals? Find a new job asap and jump ship before the company crashes

 

[purposedgrace]

@godsgirlxo Normally yes, but in our case, our CEO has a backup plan to take money from one specific investor (who were willing to invest earlier but our company put that on pause thinking if we ever run out of money then we could take it). They are willing to put money but our CEO didn't want to give away the shares. But if it goes down then he'll have to. That's what he said.

 

[jxmxt]

@purposedgrace ESOPs hold less value when switching. Main negotiating factor will be your salary.
Do keep in mind that this is a very young startup and in such a stage employees generally get more equity rather than hikes.

If you are young, can weather the initial hiccups and see the business growing then you should wait. There will be more value in that and the swtich then will get better hike.

But if you see this ship sinking then go ahead and switch.

 

[purposedgrace]

@jxmxt True. Especially with a long vesting period it's not going to be of any value for me if I leave before that. Our startup is definitely doing better than a year ago and are acquiring clients but not to an extent that we are making a profit. It may take another probably 2 or 3 years to reach that point. I'm nearing my 30s and I could manage until now but I need to be financially better in the coming years. The thing is I could do better financially if I make a switch but I'm confused as to whether I'd regret my decision of leaving the ESOPs.

 

[mpax38]

@purposedgrace Startup espos are good as toilet paper. You can't sell it (unless someone within the company is willing to buy) plus the vesting period is long.
Moreover larger companies don't care about ESOPS, they typically always operate over your Base salary and offer esops based on their assessments.
Jump ships.

 

[purposedgrace]

@mpax38 The thing about ESOPs absolutely on point. Even my colleague who's also going to get an appraisal next month said that if this is the case then he wouldn't take ESOPs.

Anyways, I think now I'll have to wait for atleast 3 months before changing jobs.