Dear SaaStr: My CRO Candidate Is Insisting on Anti-Dilution Protection. What Should I Do?
A number of online communities have taught CROs to ask for everything:
- The most equity
- The most cash
- Years to exercise their equity
- Large payments if they are let go, even for cause
- Etc.
I get it and my general recommendation to VPs of Sales and CROs is … Pick 2. Pick 2 non-standard asks in the comp discussions. But if you ask for everything, multiple times … that may be pushing too hard.
And an anti-dilution clause is a bridge too far. No one gets this. Not even investors. Not really.
Yes, investors get a very limited type on anti-dilution protection, but only in a downround, and it’s a very narrow and limited. Employees, including CROs, are granted equity as part of their compensation, and that equity is subject to dilution like everyone else’s. Including investors.
It’s an interesting ask. But it’s too much. And it’s not fair to everyone else.
