Do not start at 10%. Carta’s method is bottoms-up: list the roles you will fill before the next priced round, put a cited grant on each seat, add refresh, then sanity-check the total against peer percentages. Index’s default Series A hiring plan through Series B adds up to about 10.4% fully diluted, against a 12% ESOP recommendation. The gap is the buffer. Not legal, tax, or compensation advice.
Horizon is the next round, not an IPO. Carta: size for the next 12–18 months of hiring. Among startups raising Series A in Q2 2025, the median time since seed was 616 days, about 20 months. Kruze uses 18–24 months when you walk a term-sheet pool down from a round number. If your plan says 14 months to the next raise, use 14. If it says 20, use 20.
What the bottoms-up is
Write down the seats: functions and seniority, through the date you expect to raise again. A line like “grow headcount 40%” does not count.
Put a grant from a named source on each seat. Size executives as a percent of fully diluted equity. Size staff the way Index does after Series A: a percent of base salary, converted at the post-money. Use executive equity grants by stage for VP and C-level bands. Empty cell if the source did not publish that seat.
Add refresh and a buffer for the hire you did not plan. Carta: the pool has to cover new-hire grants and refresh grants through the next round. Index: an unexpected executive, or a plan that steps up, is why their Series A scenario lands at 12% rather than the 10.4% the hiring list itself consumes.
Then look top-down. HSBC Innovation Banking 2026 Term Sheet Guide, cited by Carta: most common pool 10–15%, 10% most frequent. Index US path: traditionally ~10% at seed, often ~15% at Series A. Kruze: term sheets often show 10%, 15%, or 20% as a generic ask. If bottoms-up is 11% and the sheet says 15%, you are negotiating over the 4 points.
Index’s Series A list, added up
Index published a plausible hiring plan between Series A and Series B: about 50 people. One C-level, three VPs, then directors and ICs across engineering, product, GTM, and the center. Combined with their default staff grants (as a percent of salary) and typical exec packages, the new grants are about $1.6 million. On a $25 million post-money Series A, that is 6.4% fully diluted. Add a typical 4% already allocated to people hired before the round, and the ESOP you need is 10.4%. Their recommendation is 12%, so you are not writing the last grant on empty.
| Function | Level | Hires | Grant basis (Index) |
|---|---|---|---|
| Executive | C-level | 1 | ~1% FDE typical; C-level band 0.8–1.5% |
| Executive | VP | 3 | 0.3–0.8% FDE at Series A |
| Eng / product / BD | Director | 2 | 75% of salary |
| Eng / product / BD | Senior | 10 | 50% of salary |
| Eng / product / BD | Individual | 15 | 33% of salary |
| Marketing / finance / HR | Director | 2 | 33% of salary |
| Marketing / finance / HR | Senior | 4 | 20% of salary |
| Marketing / finance / HR | Individual | 5 | 15% of salary |
| Sales / CS | Director | 1 | 33% of salary |
| Sales / CS | Senior | 2 | 10% of salary |
| Sales / CS | Individual | 5 | 5% of salary |
| Total new hires | 50 | ~$1.6M, or 6.4% of a $25M post-money |
Source: Index Ventures, Rewarding Talent, “Grants – The full picture post-Series A.” Dollar grants in that table are Index’s indicative figures, not a survey of your city. Your list will not match this count. Rebuild it. If you follow their scenario entirely, they say you need a 12% ESOP through Series B. They model 12% at A, 14% at B, 16% at C for the next generation of European successes. US path is often ~15% at A, toward 20–25% by Series D.
Run a proposed VP percentage against remaining unallocated in the executive equity calculator.
Seed is a smaller list, not a smaller method
Index: traditionally ~10% at seed. YC and The Family, via Index, advocate 20% at seed with valuation raised to accommodate it. That is a top-down fight with seed investors, still fed by a list of seats.
For a typical seed team of about ten, Index’s US seed grant grid (Advanced HR VCECS Seed Data, 2018) adds up to about 5% fully diluted at a $6 million post-money. Senior engineering and senior product/design at 1.0% FDE. Mid-level engineering 0.45%. Junior engineering 0.15%. Special cases at 2% or 3% (solo founder filling a skill gap; deep-tech ML/AI/VR). First sales is not a true VP in Index’s seed chapter; UltraTalent and The CRO Report put that seat at 0.5–2.0% FD.
Do not spend the 10% traditional seed pool on two “VP” titles. Hold unallocated for the scaler. See grants by stage for the title-inflation mistake.
Take the list into the term sheet
Kruze: ask why they want that pool size. The usual answer is “enough for the next 18 or 24 months of hiring.” Put the list on the table. If it is lower than 15%, you can often bring the number down. If it is too low, you run out mid-round and top up with less negotiating power.
Placement, meaning who pays for the top-up, is a separate argument. Pre-money pool dilutes existing holders before the new money prices in. Post-money shares it with the new investor. Kruze almost never sees the founder-friendly version. Carta calls the same mechanic the option pool shuffle. Walk the placement on the equity hub or run the option pool shuffle calculator. Your hiring plan sets the size; placement sets whose percentage moves.
SAFEs and converts price at the close. Kruze: they usually do not eat the pre-close pool increase, so founders take more of it.
Mistakes that show up as a 15% line
Defaulting to 10%. Carta: avoid picking 10% by default. The right size is the amount you need to hire the team that gets you to the next milestone. Too big over-dilutes you. Too small forces a top-up before you have negotiating power.
Sizing to an IPO. Index: ESOP size is a board decision meant to cover talent through the next round. You do not want to reopen the plan between raises if you can help it, but you also should not pre-pay Series D.
Ignoring refresh. A four-year vest without a planned refresher is a retention hole at 2.5–3 years. Index and Carta both put refresh inside the pool you are sizing now.
Counting allocated grants as remaining pool. Unallocated is what you can still offer. Promised IOUs from seed, per Index, belong in the allocated column before you tell a Series A investor how much room you have.
Title inflation inside the plan. A seed “VP Sales” at 1.5% is a first-sales grant, not a Series A VP grant. Putting scaler equity on a phase hire spends pool you will need later.
Worked situation
You’re raising Series A. The sheet says 15% pool, unallocated today is 6%, and you have a 16-month hiring plan. Build the 16-month list with cited grants. Suppose it comes to 9% including a 1-point buffer for refresh and one unplanned director. You need a top-up of 3 points of unallocated, not 9 points to 15%. Take 9–10% to the lawyer and the investor. If they still want 15% pre-money, they are asking existing holders to fund extra pool the plan does not consume. That is a price term, so model it as one instead of treating 15% as the hiring plan.
Labeled sketch: not a company and not a term sheet.
Sources
- Carta, option pools — 20 August 2026. Bottoms-up vs top-down; 12–18 month horizon; Q2 2025 Series A median 616 days since seed; HSBC Innovation Banking 2026 Term Sheet Guide for 10–15% / 10% most frequent.
- Index Ventures, Rewarding Talent — ESOP size by stage; Series A hiring plan and $1.6M / 6.4% / 10.4% vs 12%; seed team of ten ≈ 5% FDE; YC / The Family 20% note.
- Index Ventures OptionPlan
- Kruze, option pool shuffle — 29 January 2024. 10% / 15% / 20% generic term-sheet asks; negotiate from an 18–24 month hiring plan.
- Executive equity grants by stage — VP and C-level bands used when you put a number on a seat.
Related
- Equity & cap table
- Executive equity grants by stage
- Executive equity calculator
- Option pool shuffle calculator
A hiring-plan pool is still a board number. Founders who have taken that math into a term sheet will pressure-test the seats and the remaining unallocated pool in a FounderNexus session.