How Summer Interns at Startups Can Increase Their Chances of Securing Equity at the End of the Summer

Entrepreneurship and startups offer a unique and exciting environment for professionals, especially interns. Companies often aim to attract talent and retain top performers. For summer interns, however, the landscape can feel a bit trickier when it comes to securing equity deals. This article aims to guide interns on how to maximize their chances of securing equity by the end of their internship. While the conventional wisdom suggests that interns aren't a priority for equity deals due to their short tenure, there are still ways to navigate the system and increase your chances.

The Motivations Behind Equity Deals

Equity offers employees two primary motivations: attraction and retention. Startups give equity as a means to:

Attract top talent Retain high-performing employees

For summer interns, it can be challenging to leverage these motivations, as the intern's tenure is limited and the intern will eventually leave the company. That said, understanding how equity works and how it aligns with personal and professional goals can help interns position themselves favorably.

Understanding Equity and Vesting

Equity is typically offered in the form of stock options, which vest over time. A common vesting schedule is a five-year period, with vesting starting after one year, then spreading out evenly over the next four years. This design encourages long-term commitment. If an employee leaves within the first year, no vesting occurs, ensuring that the company retains the value provided by the employee's efforts in the long run.

How to Maximize Chances at the End of the Summer

While focusing just on short-term projects or contributions may seem tempting, the key to securing equity lies in demonstrating long-term value and future potential. Here are some strategies:

Strategically Contributing to the Company

Identify key projects and initiatives that can benefit the company long-term. Even as an intern, you can contribute to these efforts. For instance:

Help in developing strategy documents Participate in market research to identify trends and opportunities Assist in creating detailed market analysis reports Support in building foundational data for future analysis Contribute to product development processes, even if it's minor contributions like feedback or drafts

Consistently exceeding expectations and showing a proactive, can-do attitude can make a big difference in how you are perceived.

Building Relationships

Building strong relationships with key stakeholders within the company can provide you with access to information and opportunities that are otherwise unavailable to interns. These relationships can be instrumental in obtaining insights and being considered for equity deals. Here are some suggestions:

Attend meetings and seminars Build rapport with managers and mentors Offer to help with tasks that might benefit from additional support Be open to feedback and suggestions Participate actively in team activities

Positioning Yourself for Future Success

Ending the summer with a strong resume that includes significant contributions and a clear path to future success is crucial. Demonstrate your value and your ability to take on more responsibilities. Highlight achievements and initiatives that align with the company's long-term goals. Here’s how to do it effectively:

Create a comprehensive project timeline with contributions Document your achievements with specific examples and metrics Identify areas where you added value and how it benefited the company Update your resume and LinkedIn profile regularly to reflect new achievements Write a final report or summary of your experience that aligns with the company's goals

These efforts will not only make you more valuable to the company but also increase the likelihood that you will be offered equity as a reward for your contributions.

Considering Alternative Strategies

If you find that direct negotiation for equity is out of reach, you can explore alternative strategies:

Salaries: Negotiate a higher salary for your summer internship, which can provide immediate financial benefits. Benefits: Explore additional benefits such as health insurance or stipends for professional development. Networking: Use your internship experience to build a professional network that can lead to future opportunities.

Equity isn’t the only way to recognize an intern's value; these alternative strategies can also prove beneficial.

Conclusion

While securing equity as a summer intern in a startup might seem challenging, it is achievable through strategic contributions, strong relationships, and a clear pathway to future successes. By consistently demonstrating value and aligning your efforts with the company's goals, you can position yourself as a worthy candidate for equity. Additionally, exploring alternative strategies ensures that you don’t miss out on other valuable opportunities that can benefit your career.