We're a software startup with annual revenue in the ballpark of half a million. We're completely bootstrapped, and have no current plans to take funding. We currently have 4 employees. We're looking to hire two new developers as we shift our focus to a new complementary product - one senior back-end web developer and one junior front-end web developer. The back-end position is much harder for us to fill. Both will be paid about market rates. No benefits.
I'm new to equity incentives. How should we plan to tackle this? What percentages for each? Is issuing options better than stocks? How do we go about setting a strike price? How big of an option pool should we set aside? Any advice on vesting periods or clauses to include? We're based in Canada, if that makes a difference. Thanks!