The thing I try to think about in the context of me being the owner of a successful business, and not necessarily in software, is profit sharing, as opposed to equity sharing. Profit is a degenerate case of equity, in the sense that a large (albeit not whole) part of why you want to own equity is to own a share of the profit. At any rate, at the level of employee options, you want own enough equity to play the decision making role that holding equity enables you to. Beyond that, the value a market assigns to equity you own is (should be!) ultimately dependent on the profit that will accrue to that equity. At the same time, profit sharing is a lot less messy and much more rewarding to employees than equity. Sure, you're not getting a share of this asset that you've helped build, but from what I'm hearing, the story is the same with options. And profit should be easier to "give away" than equity from the founders' perspective, I think. I realize that sharing profit is complicated when businesses are in the red, but on the whole, I suspect there might be better value in the idea for all involved. Not that I have any idea about how exactly to go about sharing this profit, assuming it exists, I don't. I just happen to think it might be a more satisfactory path to take, assuming the fork on the road reads "Equity Sharing" this way, "Profit Sharing" that way.