Today’s episode is with Kaitlyn Knopp, founder and CEO of Pequity, which automates HR workflows to make compensation more equitable and scalable.

Prior to starting Pequity, Kaitlyn built compensation programs and teams at companies like Instacart, Cruise, and Google — bringing a deep well of experience to this often complicated topic.

We start our conversation with her advice on the traps founders need to avoid when they’re making their first hires. She sketches out a lightweight framework of how to think about comp at this early stage, from broad levels to an initial comp philosophy.

We then get into the pros and cons of negotiating offers, as well as creative approaches you can bring to other aspects of comp outside of salary, such as the exercise window. Kaitlyn also shares tons of tips around how to communicate the value of equity, especially with candidates who’ve never worked at a startup before.

In the back half of our conversation, we dig into the comp challenges that come up as a company starts to grow quickly. Kaitlyn shares advice on retaining existing employees through techniques like equity refreshes. We also get into the psychology of bonuses, as well as how to navigate inflation and salary adjustments.

Kaitlyn shares her take on the recent trend of offering very individualized packages, and she ends on the importance of helping employees to fully understand their comp, and not shying away from topics like dilution and tax considerations.

You can follow Kaitlyn on Twitter at @KaitlynKnopp. You can email us questions directly at review@firstround.com or follow us on Twitter @firstround and @brettberson.

For more information on Cocoon, visit http://meetcocoon.com/