I am involved with a startup that has a very unique structure. We started as friends, all working in our spare time, never intending for it to become a business. Eventually, it started catching on and we have continued to grow over the past few years.
When we officially decided to make it a business, we gave equity grants to everyone involved for the work they put in up to that point. Additionally, chunks of equity (dependent mostly on how much time each person would be able to put in going forward) would vest over time. So, everyone is still working part-time.
Eventually we grew to a point where one of the co-founders became a full-time employee, taking on a lot of the other co-founders' work. Now, most co-founders are involved a lot less than initially intended, and will likely become less involved as we hire other full-timers.
So, we're struggling with the best way to manage equity vesting for all of us part-time co-founders. Additionally, some roles are not viewed as "strategic" enough to merit earning equity, particularly if they are somewhat mechanical and can be hired out. Granted, most co-founders still want to be involved, but have seen their roles diminished over time, and not necessarily their own fault.
How do we balance paying people and earning equity? How do you handle vesting for someone that was only expected to participate part-time, but ended up contributing less than expected (and not exactly intentionally)? Is it possible to say what an "equity earning" project/task is and what isn't? This seems like the perfect example of why you only give equity to full-time co-founders, but we are young and foolish. Fortunately, we have a viable and growing business, and we'd like for it to continue to be such by creating a fair situation for everyone.
