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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 ...
4
votes
3answers
500 views

Are co-founders employees? Do they need to be paid minimum wage?

If there is a co-founder with 20% equity in the company but no salary, what is his status in the company? Should he be considered an employee? What is the difference between a cofounder and an ...
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
15answers
2k views

Do single-founder companies ever get funded?

Most companies I see funded usually have two or more founders. Do investors, angels or VCs, look down on one-man-companies? Are there many that get funded? Or is it just that it's rare to have one ...
7
votes
8answers
2k views

Investor wants 51% shares of our company

We are five engineering students, going to start up a company. As there are many competitor companies in the market, we were looking for an investor to start very big. Fortunately, we found an ...
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 ...
4
votes
3answers
1k views

How is ownership of equity re-distributed at each stage of growth?

I've been researching for over a year now as an aspiring entrepreneur, but I am still fuzzy on how equity gets distributed at every stage of company growth. Is a set amount of "shares" created upon ...
5
votes
2answers
812 views

Stock Splits for founders

I know this has been addressed. However, each set-up is different and I want to proved the particulars on this one to get some thoughts. I need some help establishing an equitable Cap. Table. My ...
2
votes
8answers
1k views

20% equity and CTO. (Story and details). Is this fair?

This is a long exposition. Please bear with me, I think that I need to provide as much specifics as possible, while keeping it as short as possible. Thanks for reading, any feedback is much ...
3
votes
1answer
132 views

How to estimate value of non monetary and non working hours contributions?

Suppose a startup has 5 founders with the next contributions... 1: X hours of work in the startup. 2: A patent (the design of a product never produced). 3: $50K of funding. 4: Marketing skills. 5: ...
3
votes
3answers
315 views

If I launch a new division within my employer's company, should it be treated as a separate startup?

I've been working for my current employer for the past several years as CTO. I recently pitched them on starting a separate division that is more entrepreneurial and experimental to spin out ...