Here’s a business scenario involving two persons:
Person A: - has business strategy and technology road map for a line of business in software - has 4-5 customer prospects who are interested in his road map and what he may develop - has skilled engineer contacts willing to come on board with him - is working with a GPL licensed software out of which a product line can be created, but otherwise has no product to sell yet, and no money
Person B: - has bean counting, administrative and facilities-management skills - has money to invest - has bought the IP assets of a dead company in the same line of software business as person A. No active work has been done on the IP for several years. - has no road map for working with the IP he has bought, nor technology knowledge, ability to put together a team, or customer prospects
Prospective scenario: - It is possible for A and B to come together to start a business, with perfect complementarity of what they bring to the table. The customer prospects, business strategy, tech road map and initial team that A can bring will work very well with (resumed development work on- and with) the IP that B has bought. - A can be hired by B as the CTO-CSO, with at-market salary, stock options, benefits, etc. - B has other options to invest his money elsewhere. However, in order to create a business out of the IP assets he has bought, he has no other option than to come together with A.
Question: How does one evaluate or monetize what A is bringing to the table to create the new business? Is it reasonable or advisable for A to create himself as a business, and sell his value to B (for part cash, part equity) before coming on board to execute on the new business? Or should he negotiate for some kind of co-founder compensation (again, with part cash, part equity)?