What changes when you join a bootstrapped company
A bootstrapped company funds itself from revenue, and sometimes the founders’ savings, instead of venture capital. No investor is waiting for a sale or IPO, so growth follows what customers pay for. That often means steadier priorities and less pressure to grow at any cost, with smaller budgets and fewer people.
How upside usually works
Because there’s often no plan to sell the company, many bootstrapped companies share upside in ways other than stock options:
- Profit sharing: a share of annual profit paid as a bonus. 37signals shares 10% of its annual profits with employees after two years, and Buffer paid out 15% of its 2024 net profit to its 73-person team.
- A share of sale value: a promise of part of the proceeds if the company is ever sold. 37signals, for example, sets aside 10% of the company’s value for employees if it is sold or goes public, while stating it has no plans to do either.
- Phantom equity or profits interests: cash or partnership interests tied to the company’s value. Companies set up as LLCs can’t grant incentive stock options, so profits interests are the most common substitute there.
- Stock options: some bootstrapped companies grant them, especially if a sale is possible one day.
Before you apply
- Ask how the company shares upside, and whether it is written into a plan document or your offer letter.
- For profit sharing, ask how the pool is calculated and what was paid out in recent years.
- For equity or phantom equity, ask what happens if you leave and what would trigger a payout.
- Compare the salary with venture-backed companies hiring for the same role, since cash usually carries more of the package.