I am a middle-aged computer programmer at a big tech company making about $290k between salary, bonus and stock grants. For the most part I'm at an ideal job for this point in my life. I'm maxing out my 401k and mega-backdoor roth while paying for two kids' college with what's left over. My job isn't particularly interesting, but it isn't unpleasant either. If I were smart I would keep riding this gravy train as far as I can, but here I am itching to join a startup.
I'm evaluating an offer to be the 10th employee at a developer tools startup with series a funding. The offer is for $160k and 0.15% equity. So I would see a significant decrease in cash flow.
If I consider a three year run with the startup vs my current job, I would be giving up approximately $390k in compensation (ignoring raises and growth in the current company's stock).
$390k / .0015 = $260M. I'm viewing this as investing $390k in the startup at a valuation of $260M + 409a valuation -- presumably what my strike price will be based on.
Is that a valid way to look at it? Is there a better way to look at it?
EDIT:
Thanks for all the replies and advice. I only meant to ask a targeted question about valuation, but you gave me a lot more wide ranging advice. I appreciate that. It helps to read a variety of takes on this.
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