Co-Founder Equity Splits

this. he should be looking at you as a hire, not a co-founder. he put in $1mil+. what are you going to put in? nothing but experience? then there shouldn't be an expectation of anything close to equality.

Equal split or walk away. Anything else but an equal split will create incentive problems later on, look weird when you're fundraising, and make you feel under-appreciated and unhappy in case the company succeeds.Personally I think you should walk away anyway. The fact that they're trying to scam you with 5%-10% at this stage is a huge red flag in terms of culture and strategic knowledge. They either have no idea what they're doing, or they're actively trying to screw you,

Sets off a red flag for me. When contracting, the companies with equity you might actually want are able to pay for your services with cash.Different story if you were really excited about the project and the opportunity, really confident in your client's abilities, and wanted to become his full-time cofounders. But then I'd propose you divide the company equally three ways.

Right free = 50% (or equal share if there is more than one partner) if not you can work on your own idea for free and keep 100%. To me this deal stinks, it also smells really bad by the fact that salary will be negotiated once they are funded when you have far less leverage to bargain with. Right now you have everything that they need yet they want to stack the deck totally in their favor. My personally experience with individuals like this is they will only get worse if they do get funding. I w

how much equity is about to be given up? will original co-founder and wife get over 51% equity? do you have the option to forgo some pay to maintain your equity position in the company?

Yep, just grandstanding. Point being that the equity offered should be commensurate with the value of the co-founder. If you're only offering 10% to someone who is worth 20%, don't expect to get full value. That guy will have a side project going while working for you.

are you suggesting that the founder with his early MVP and idea should split equally with others that he brings on board?

You agreed on 50/50 when you joined, there is no way CEO will give his equity to you. Would you do it?

I agree with this - just remember that under no circumstances should you give away equity of the company. Tell him that if he wants to own 50%, he has to pay 50% of the costs as well. Tell him you're going to rapidly expand and ask him to commit $50-$100k (that you could easily seek from outside investors) or he's going to risk being diluted. I bet you he will change his tune.

Having done a 95%/5% or similar arrangement in the past, here are a few things I didn't consider:• Unless the company's already been generating substantial revenue, 5% is an implicit message that what you've brought to the table already (an idea maybe) outweighs what this person could contribute working their hardest by a factor of ~10. That's out the window if there's salary on top of that, but if it's straight equity, it's an "I'm 10x bette