I currently work freelance as the sole software engineer for a small but promising startup company. I've been working with them for a several months, converting their "demo ware" software into something more robust and suitable to supporting the service they offer.
Understandably, they want to keep costs as low as possible and have offered me a share in the company in return for me reducing my freelance rate significantly.
I currently earn a good rate, but the salary they require me to drop to is office admin sort of money i.e. just enough to live on. The share on offer is 5%.
I'm interested, as the project does have promise, but the business is not turning a profit yet, and I believe that it will be at least 2 years before the 5% share is worth anything. In this time I will have sacrificed the best part of 2 years salary - and this is if the project succeeds.
I would like to own a share in a business such as this eventually. I really want to see the project do well, and don't like being the major cost to the company, but I don't feel that what's on offer is enough for me to make that kind of sacrifice.
Am I being short sighted? Does any one else have experience of this sort of situation that can advise me on the pros and cons of going ahead, or possible negotiation positions to make the deal more viable for me?