board member compensation

Rich and Peter weighing in on fees paid to directors on boards:

Peter:

Steve see below personally I think the 4-5 year vest seems long depends on stage of co- I would also think .4 is on the low end.
from Rasmussen, Erik erikr@safeguard.com:
Q:What's typical comp for an independent bod member- equity/cash if any and vest on the equity- finally assuming is common stock.
A: 0.4% of co in common stock. Vests over 4 or 5 years. No cash.

Rich:

Q: A friend of mine at Amazon is considering joining the board of a startup and wanted some advice on how startups generally compensate board members for their service. This startup has been self-funded and it is not clear whether the founder is interested in raising VC money. It is also not clear whether the founder intends to grow the company with the goal of a liquidity event (M&A or IPO) down the road or to operate the> company as a closely-held business indefinitely.

In my experience, I've seen startups grant options to non-employee and non-investor board members. In such cases, what % of the company is common and under what vesting schedule? Are options typically granted for each year of service as a board member? How common are annual cash payments? Are there any other forms of compensation that come> to mind?

A: Stock is the only thing I have seen start-up Boardmembers receive (plus reimbursement of expenses).The vesting is usually 3-4 years (with acceleration upon a change of control). I haven't seen more than1/2% for a board member (and that was for a real star). I haven't seen cash payments in private company world (only public). That being said, if this isn't the traditional start-up and may remain closely held forever, I think cash payments may be appropriate(10-20K year seems about right for a private company).