[bmcleod]

If you want to seriously consider this kind of cash back deal then you should look at the amount of money you're giving up as an exceptionally high risk investment.

What kind of a return would you want the upside to be for you to walk out right now and gamble 3 months of salary on a 25% chance of winning bet. Unless you've got significant wealth already then most measurements that take into account the diminishing returns of wealth will probably suggest a that you'll want the win to be at least 6 times that mount.

That's quite a lot of cash for a startup and it makes no sense to a startup that's worried about cashflow to make that kind of an offer when they could give out nice free equity.

Liabilities are much worse on a balance sheet than having employees with stock. Employees with stock in the company have an ongoing alignment with the company; employees who are owed cash are going to be slowly getting more irritated.