Equity is the value of an ownership interest in a business.
234
votes
7answers
138k views
Forming a new software startup, how do I allocate ownership fairly?
I have come up with an idea for a new social networking application. It's not something I expect to be hugely successful, but I think it does have some potential. I've approached a few close friends ...
19
votes
6answers
989 views
Teammates have pushed me out of our venture. What to do now?
I along with 3 other people created a concept for an innovative Ecommerce platform as part of a 5 week startup pre-incubator. We had a great run and on demo day we won the audience and panel of ...
16
votes
3answers
2k views
Are we about to be shafted by a Corporate Shark?
My husband went into business with a gentleman who seemed to be very clued up (he's an accountant). He has numerous other businesses and was able to open doors that we would never have had access to ...
15
votes
5answers
941 views
Losing Controlling Interest in a company, can that be bad?
Basically I have been lucky to get spotted by some angel investors and will be signing £60,000 for 60% of my current business come thursday, which will really boost my start-up massively and ...
12
votes
8answers
2k views
Should we award equity based on specific performance metrics?
My team and I are nearing the launch of our initial product this August. We are wanting to develop a metrics-based system that will be implemented upon product launch that will determine founder's ...
11
votes
4answers
1k views
Developer, offered share in small startup company in return for large rate reduction - advice needed
I currently work freelance as the sole software engineer for a small but promising startup company. I've been working with them for a several months, converting their "demo ware" software into ...
11
votes
7answers
4k views
First employee at Y Combinator funded company
I may have the chance to be the first employee of a startup going to the YC summer 2011 program.
The thing is I think they are planning to cover my expenses but not to actually pay me or offer any ...
11
votes
6answers
1k views
How to reward early employees?
In many startups there are some #1 or #2 employees who helped the whole business all the way.
I've got couple guys like that, I'd love to give them more than the salary (even though our salaries are ...
10
votes
6answers
2k views
Joining a startup within its first year - salary/equity expectations?
I've recently been headhunted by a startup a year old which I am very interested in leaving my current position in a large established business in the same industry for.
There are a number of people ...
10
votes
1answer
3k views
49/51 vs 50/50 Equity Split
What are the advantages and disadvantages of dividing equity 49/51 vs 50/50 between partners?
Edit: 51/49 feels wrong, but there may be some startup cases where it is good if you are the majority ...
9
votes
11answers
3k views
What's a reasonable amount of equity to retain when you're the key founder?
I'm working with two other partners to get a SaaS startup off the ground. I worked on this thing slowly, mostly on my own, for about two years before approaching my partners. As a background, I knew ...
9
votes
8answers
1k views
How to best resolve current problems in my multiple-founder startup
I've been voraciously reading about startups for the last week, this site included. Unfortunately, I've come to the conclusion that the equity structure of our startup needs to change and I would ...
9
votes
1answer
447 views
Prenuptial separation agreement for cofounders
My apologies if this question has been asked before. I tried to find the answer reviewing other questions and still don't have the answer so here is the question(s):
We are now setting up the ...
8
votes
9answers
2k views
How to resolve conflicts on a 50/50 startup?
We are going to found a startup with equal shares.
One as the product/tech partner being the other the marketing/sales partner.
We are going to found on a 50% equal shares. Not 51/49. Just 50/50.
...
8
votes
8answers
2k views
What would be a fair equity distribution between me and my co-founder?
Me (software developer) and my co-founder (UI designer) are looking forward to build a SaaS startup. I would usually lean towards a 50/50 distribution, but in this particular scenario, the ...
8
votes
9answers
487 views
Should money prevent me from starting a company
I am a 40 year old software developer in the finance industry. Since my 20's my I have a pattern of working for a few years to build up the bank account, and the pursuing some entrepreneurial venture. ...
8
votes
9answers
2k views
Co-founder wants to leave, do I pay him back the money he invested into the business?
My co-founder and I have been working on a business idea. We both invested money into getting it to a MVP stage, but it hasn't been launched and does not make any money. (It is basically a modified ...
8
votes
2answers
599 views
Fired from startup, vested equity
I was recently terminated from a startup without cause, where I was one of several founders owning a decent percentage of stock. We also had an angel investor (incubator) in with us for a small ...
8
votes
4answers
1k views
How to approach 51/49 partnership offer
A good friend of mine has a great idea for a project. He has more experience than I have, far more connections, and some awesome skill. He has some ideas on building tools for some major corporations, ...
8
votes
2answers
1k views
How can a past employee protect themselves against share dilution?
What is share dilution?
How can I, as a past employee of a company where I exercised my share options, know if my shares are subject to dilution?
How can I protect myself in future from share ...
8
votes
1answer
2k views
How to Divide Up Your Company's Equity
We get a lot of questions about dividing equity and for good reason. Dividing up your startup's equity creates a lot of heart burn for all of us. It's a tremendously stressful affair if you have never ...
8
votes
2answers
256 views
Late founder equity allocation
Guy is late coming founder, the company not yet incorporated.
I designed the product (several biomed multisensor devices) and taken it from concept to a mature prototype ready for manufacturing (1 ...
7
votes
6answers
922 views
I need advice - Lead developer slap in the face
I have been working with a startup for 6 months. It is an advertising company for which there is a very heavy technology portion (I would say 50% of the company is based off of a mobile front-end, and ...
7
votes
9answers
3k views
Is performance based equity vesting possible?
I'm willing to give 20% of my startup to my partner who has an MBA and good experience.
His main responsibility will be sales, marketing and deal making. I'm the developer.
I'm working full-time on ...
7
votes
8answers
567 views
Should give 20% of my start-up away to a high profile UX academic?
I'm in the process of registering a company for my start up. I've been developing the concept 60 hours a week for the past 6 months. I've attracted the interest of a high profile UX academic that ...
7
votes
6answers
527 views
I'm declining investment offers. Am I doing it wrong?
I'm about to launch my web based business, and several friends/relatives offered to invest small amounts of money(5-10k) for a few percentages (1-5%) of my company. It's a side business for me as I'm ...
7
votes
5answers
698 views
Developer Working for future equity
I've read similar questions but like anyone asking a question I think my situation is different.
My background: I've been working full time since 06 and currently work as a Sr. Developer on a small ...
7
votes
3answers
4k views
Looking to get involved with a startup, but no idea on what kind of salary/equity I should expect
I'm considering joining a startup that has raised a few million in Series A funding and I'd be the second developer joining the team. I've been out of college for 4 years and am looking for a senior ...
7
votes
3answers
5k views
What's a typical sales commission for professional services?
What's a typical sales commission for professional services?
I ask because I am thinking of going into business with some friends (professional services and product company). We agree on how to ...
7
votes
4answers
839 views
How should founders treat their paid-in cash in a self-funded startup?
In a founder-funded company, how should the founders treat the cash that they contribute to the company? Should it be convertible debt? Equity (but the founders already have all the equity initially)? ...
7
votes
2answers
4k views
What is an appropriate stock option grant for a senior engineer after the Series A?
I'm looking for suggestions as I'm considering an offer from a startup.
A friend of mine is founding a software startup together with two partners and he's looking for engineers. The idea is ...
7
votes
2answers
3k views
What is the difference between Series A, Series B and Series C investment?
What is the difference between Series A, Series B and Series C investment for a startup?
How does this affect salary and/or equity expectations if I am looking to join a startup in a ...
6
votes
9answers
560 views
Sharing workload between partners when I am the only developer?
I have been dipping my toes into a web-based startup idea with two others.
They approached me with the original seed of an idea, but neither are developers. So I would be building the (fairly large ...
6
votes
5answers
454 views
How much equity should I get for developing a site where the idea isnt mine
A few months ago, I was asked to join a startup for $85k/year. All the company really had was a pretty big angel investor and one guy with the idea (wealthy father and son with the idea). Before ...
6
votes
5answers
1k views
Stock options for a senior engineer at an angel funded startup?
I joined a startup 6 months after its founding as a junior engineer (I was right out of college at the time). I've been with the startup for almost 6 years now, and I've progressed to the point of ...
6
votes
3answers
1k views
Giving Equity to a Sr. Employee
I'm running a company from the last 10 years. Now I have hired a senior person to head the finance of the company as my knowledge in the finance is nil.He has asked for 6 % equity stake in the company ...
6
votes
3answers
198 views
Is a 50/50 equity split without 50/50 control a doable and wise thing?
I've found a great partner for my second tech startup, and want to structure this one better than the first, which made money but eventually got ugly due to poor choices my younger self made along the ...
6
votes
8answers
6k views
Equity distribution amongst startup co-founders
I read some articles about Startup Equity Distribution:
Here is one of them: http://blog.weatherby.net/2008/10/startup-equity-distribution.html
They give good insight, but still I couldn't use the ...
6
votes
2answers
444 views
Non-Founder CTO Equity?
Background:
I'm the co-founder for a 2 year old startup that is currently bootstrapping and solidly profitable (300k+ revenue this year).
When we hired our 3rd and 4th employees (COO and CTO ...
6
votes
6answers
2k views
Equity distribution in an early stage
I would appreciate to get some feedback from you in order to determine the equity distribution of the startup I am currently seting up with friends. The problem is that we've start working without ...
6
votes
9answers
2k views
Programmers Working For Equity
I've been having so much trouble finding a programmer to work with. I don't have the money to pitch out to hire a developer, I've tried and failed to code on my own, and I rarely get responses from ...
6
votes
3answers
744 views
25% for angel investor for 20k$
These days I am in process of raising 20k$ for my project (a facebook application), that requires at least 30k$ (10k of which I am able to come up with myself).
When negotiating with an angel investor ...
6
votes
3answers
746 views
How are all these silly web startups raising so much money?
Forgive me if this is a duplicated to any other questions (which I dont think it is), but lately all I hear about is how XYZ web startup has managed to secure another 20 million in seed funding, etc ...
6
votes
2answers
189 views
My sales person (independent, not employee) wants to be an angel investor
I started a surveillance technology company in May 2010. Since the beginning, we have been working with a person that has been in the security industry for quite a while. He was providing some input, ...
6
votes
1answer
177 views
Review offer for being employee #1
I've just been offered a developer job at a startup in the current situation.
- Pre-Series A.
- Current seed funding gives them a valuation of $5 mil.
- 4 founders, no employees, 1 founder is a ...
6
votes
1answer
190 views
Equity and compensation for boot strapped venture
I have been approached by a friend to help with the business side of a venture that he has developed/bootstrapped. No external funding until now. He has developed a working product with outsourced and ...
5
votes
5answers
3k views
Sample milestones for co-founder value-contributed equity distribution
Question:
What are some sample milestones/goals to set for co-founders to allow them to gain equity for contributing value to the company, like a vesting-based equity plan.
Backdrop:
Let's say ...
5
votes
9answers
701 views
Equity to a 2hr/day co-founder
I'm a tech founder of a startup in the very early stage. I'm looking to add a business development, sales, and marketing co-founder. However this guy is looking to invest 2 hours per day while i'm ...
5
votes
4answers
429 views
Is there anything I have to do to maintain my equity after leaving a startup?
I left a startup recently and had equity that vested (about 1/5 of a percent).
I have a signed contract to this effect.
As the parting wasn't necessarily the most amicable, is there anything I ...
5
votes
2answers
1k views
Minority Partner
I've decided to take on a minority partner for my startup. This individual will have a 25% stake in the business and I will retain 75% as the founder. My partner will not be putting up any money, ...
