How to best resolve current problems in my multiple-founder startup

I can't give you an un-biased answer, because I only have your story to go on, and your story is biased by you. Having said that, your description of the situation seems well researched and reasonable.

I've put in about a 200 hours (compared to 30 for B and 60 for A)

These numbers seem quite low to me. Did you guys just start out a few weeks ago? If someone puts in less than 1/4 of a full-time work week, then I wouldn't count that person as a founder at all, so both A and B seem questionable here. On the other hand, if you guys just started this, then maybe you're a bit 'greedy' to worry about ownership already, when your cofounders haven't really had a chance to prove themselves.

and the project idea and implementation look supremely promising.

Hmn, how big is the opportunity here really? I would not play hardball with friends for a nice little side business that provides some extra income. I might play hardball for a opportunity that is potentially life-changing.

I early on pushed for getting an operating contract agreed to by all three

So you guys have had the founder's discussion, and you have created a contract between you that solidifies the 1/3 - 1/3 - 1/3 equity split. Well, then you have a problem. It's basic human nature to hate loosing property, and if you renegotiate this split now then you'll most likely demotivate your cofounders, or possibly even start a feud.

Am I justified in requiring a restructuring to a vesting plan before I continue development?

Justified in a moral, or contractual sense? In a moral sense, maybe, but maybe not. In a contractual sense, most likely not, but go see a lawyer about this. But one thing that I'll say, over the years my approach to business has become less about "just" and more about "realpolitik".

Am I justified in thinking that a vesting plan should probably place B (and perhaps A due to less risk taken) with less over all equity?

As you have presented the facts, I would say yes.

Since I already agreed to the current agreement should I suck it up and chalk it up to a life lesson (even though I feel like its a demotivator for me)?

Phew, that's a hard one. All I can say is look inwards, look at your life's circumstances and your personal values, and take advice from your closest ones but keep the decision yours.

Three thoughts to leave you with:

• Over time, opportunities to change things will present themselves. If you seize these opportunities when they arrive, you may be able to gradually chance things without demotivating your cofounders too much.
• Maybe you can re-cast the whole company proposition, and use this 'new' situation as leverage for change, and face-saving device for your cofounders? Maybe the first costumer feedback is so strong that you all need to go full-time and seek additional funding, and those who do not follow must naturally accept a certain ownership dilution? Or do you have a better, more appropriate scenario for your company?
• Many people don't ever get a 'good' business idea. If you now have a 'good business idea', maybe you first thoughts should be about execution, and how you can motivate your cofounders to their maximum, so that they add more value than they do today.

There are couple of things I have learned in 12 years of startups with all those victories and scars:

• Don't get greedy (in this case I think you are)
• Value you give yourself is often too high, come down to earth
• Everyone is replaceable (I know devs especially hate admitting that)
• Don't waste your time on anything but equal splits, because you will be squabbling over % in $0 until you have a product that brings revenue beyond "ramen profitable"
• If you go into business with your friends, expect to loose them
• Startups are comprised of those who make, those who sell, and those who maintain (and neither of the three are more important or valuable than the other)

And most important: commitment before ego!

P.S. I have to be honest with you, I am reading a lot of ego in your story. As Joseph suggested, focus on building 1.0. If you ever get a chance for VC or exit (and that is always a HUGE if), investors/buyers will tell you what you are worth or simply squeeze you out. C'est la vie.

First, you're never going to have a "perfect" startup experience. Every new startup is a new learning opportunity. Considering you've collectively only put in ~300 hours, this seems to be a VERY early stage effort, and trying to renegotiate equity at this stage seems premature.

You asked about chalking it up to a life-lesson, and my reaction is yes.

Spend your energy on getting to v1.0, and once you get to the point of needing additional investment or time (which will likely happen), use that as the opportunty to open up the equity discussion again.

You're going to learn a lot during your startup - take this as lesson one, and learn from it before the next round of investment and negotiations.

1. I'm a big fan of vesting. A friend blogged on the precise topic. My business is predicated on the benefits of vesting.

2. The number of hours put so far are so small that in the grand scheme of things, it doesn't matter.

3. Your current assessment is more or less correct, however, you (like all of us) suffer from bias. Sure, currently you are doing all the work. So you feel cheated by only owning 30%. But project yourself in the future. Three months from now, you are done developing the product. Now what? It needs to be sold. Someone needs to pitch it to companies, meet them, cajole them and eventually collect orders. That's when your co-founder A will step in. Will he deserve his 30% cut then? I'd think so.

Basically, don't underestimate the effort required to sell a developed product (I blogged about this as well...).

I think an equal split among founders was a reasonable choice. Think of it this way: it was not your idea. Would you feel it's fair to get more than 50% of the equity? At best, maybe you deserve 50%. Right now, you have 30%. If this becomes a multi-million dollar opportunity, the difference, while significant, is not that much.

PS: the only thing I'm unclear about is the value of co-founder B. But sometimes, the nugget of insight you get from a 5-minute discussion with a co-founder is worth just as much as the 3 days of coding you just put in. The clock is the enemy of the co-founder.

The first question that needs answering in order to help you is "What type of agreement do you currently have in place with the other founders? This will determine whether there's a point in discussing the current arrangement, as you may find it to be legally difficult to change if you have a contract, a corporation with joint ownership already established, etc.

You may, however, be in a similar situation to some startup founders, where all you have is something called a Statement of Understanding. What this document does is outline the premise under which the startup will operate until you have the time and resources to create a formal contract, at which point, that document will be used as the basis for that contract.

I will assume, for the sake of argument, that you are in that situation of having only a Statement of Understanding (which is not legally binding, but does have legal implications).

Getting over the fact that you made a lousy arrangement, at least as presented here, with no vesting schedule at all, you need to move forward. As asked in one of the other answers, how long have you been working on this? I've worked for several months on developing an idea, and it took several hundred hours. Over the course of a couple weeks, though, my contribution has often been proportionally less than that.

Realize that in developing a large project, at least initially, there will be a lack of balance between the various contributing parties, but that doesn't make any one of them less important than the others. For example, if one person's expertise is sales, you wouldn't expect them to put in a lot of work until significant progress had been made on the development.

That being said, you need to evaluate not only whether you are putting in an "unfair" proportion of the work (for which you will, eventually, be paid for), but also whether you expect the others to put in a large contribution once you've mostly completed development. If that is the case, then leave your arrangement alone, and move on, lesson learned.

If, however, you don't believe that the others will contribute at a later date in amounts matching your own, then you need to decide if it's even worth the battle, if you should surrender, or back away entirely from the project. Perhaps give yourself some benchmarks to help you make the decision.

Opening negotiations that will affect the equity structure can create a lot of tension, and potentially destroy any arrangement between you. If anyone leaves the negotiation feeling resentful, then you may find the entire group falls apart as a result. You need to start by offering something that's to their advantage, not by making requests or demands.

I can't judge your current (and desired) equity agreement. I've never been engaged in a venture that required a more sophisticated plan than a simple 50/50 cut.

Negotiation 101: What's in it for the other person?
Find (or add) something in you new plan that benefits the other founders, THEN convince them that your proposed solution is better.

You do have one advantage: there's three of you. You only need to convince one of them (A or B), not both, that your plan is better.

Bismarck said "Politics is the art of the possible." and it seems good advice for this situation. Although it certainly sounds like the equity share and lack of vesting were a mistake in the original agreement, it's going to be tough to simply re-write the agreement (at least without someone feeling pissed off).

If I were you, I'd explain to your partners that you feel the agreement is inequitable because of the amount of work you're contributing and then meet to try to get two changes introduced:

1. The lack of vesting is a mistake because it puts higher risk on the founders that put in the earlier effort (in this case the development). Take a date from your plan when your startup will pivot from a product development driven mode to a sales growth driven mode. Effort in the first phase should be rewarded primarily with equity; effort in the second phase should be rewarded primarily with wages/commission. Founders should 'earn-out' their promised equity during the first phase.

2. Ask your co-founders how they can help contribute more (during the first phase) so balance what you're contributing. Perhaps some more research or marketing work could be done earlier. The best solution is going to be one where they match your effort (and therefore justify their 33% share). If they seriously can't imagine contributing the same number of hours, they may be more accepting of a lower equity share.

Incentives drive behavior.

When it comes to money (and equity) issues even the closest friendships can go sideways.

When it comes to equity the only thing that matters is what is on paper.

If you are already arguing with your business partners (at day 0), you'll probably argue (or be bitter) forever.

Life is short, maybe there is another opportunity you should pursue since you have invested relatively little time to date and just chalk it up to lessons learned?

Tough situation you are in. Sometimes you just have to lay it on the table and let the chips fall where they do. Be open, honest and to the point. Who knows, if it all blows up maybe it is for the better in the long run, as good friendships are hard to come by.