Questions regarding units of ownership in a corporation, mutual fund, or other organization.
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 ...
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 ...
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 ...
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
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
3answers
4k views
How do you actually setup a vesting agreement for co-founders w/out breaking the budget?
I'm based in Hong Kong. I've read through a lot of information about share vesting for co-founders and realized that is definitely the solution I want. I'm now trying to figure out how to actually go ...
5
votes
5answers
215 views
How does one go about finding shared office space, specifically in the UK?
I'm currently working from home, but finding this too solitary, and also need a change of environment in general so I'm considering moving cities. I think this is a great time to branch out of my ...
5
votes
2answers
533 views
How to kick out useless person in startup
Our startup has a person who holds a very high percentage of the company's common stock.
We don't have any money yet, and we've been working for a year.
This guy has done an extremely minimal amount ...
5
votes
5answers
330 views
Partner leaving at an idea-stage start up
This question might sound dumb, but I'm at a complete loss of what to do.
My friend and I discussed starting a web site business years ago. For about a year and a half, we met every other weekend ...
5
votes
1answer
192 views
When and how to “get out”? And some advice?
I have been involved with a technology startup in the UK from day 0, for over 5 years now.
The company is up to 800k+ revenue over the last year and was on track for a 150k profit. Unfortunately some ...
5
votes
1answer
103 views
How old does one legally have to be to start/own a share in a company in the US?
I am 18 but my co-founder is 17. (In other words, I am able to sign a binding contract, he is not.) We are getting ready to incorporate our startup — but is my co-founder old enough to start, and own ...
4
votes
3answers
234 views
Can I keep my S Corp open when the president wants to leave?
So I have a small S-Corp incorporated in New York State. The company really hasn't made any money, and is currently only used to hold a piece of IP. Both the President and I (the Vice President) own ...
4
votes
3answers
186 views
What disadvantages are there if I have 45% of the share?
A close friend of mine wants to start an Internet business and he offered me to be his partner. I will be responsible of building the website and deal with technical issues. He will be responsible of ...
4
votes
2answers
77 views
Payment methods and conditions for fresh startup
I am an Interface designer and a startup asked me to work with them. As of now they are only two people and do not have a budget, so they would offer a share in the company.
I would be fine in ...
3
votes
6answers
442 views
How do I share a startup reasonably?
I posted on Craig's List looking for help developing an idea into a web app. Since there's no money/funding/compensation the thinking is we would take a percentage of the company and the income it ...
3
votes
4answers
334 views
Start a business with a close friend or a family member?
Is that a good or a bad idea to start a business with someone you are really close?
3
votes
3answers
196 views
Do I have to sell my shares to my cofounder?
Our company ran low on funds about 4 months ago. We decided it would be best If I took on an advisory role and went to work elsewhere to cover my personal expenses. I have vested shares in a large ...
3
votes
4answers
473 views
Am I a co-founder?
I'm trying to figure out what my role is...
Backstory:
Late last year (October/November) I was asked by an acquaintance If I'd be keen to help develop a SaaS product that he & his brother had ...
3
votes
2answers
155 views
Made an error on incorporation, what do I need to do to ammend it?
We (me and my partner) recently incorporated as a Limited By Shares company (Ltd). Stupidly, when filling out the forms we put down 1m shares with nominal value at £1 thinking these were just ...
3
votes
2answers
78 views
Legal Status of USA/UK Start up forming
I and a partner wish to set up a company. One of us lives in the UK and the other in the USA. We both want to make sure we are one legal entity so we can sell shares, or if the start-up was bought ...
3
votes
1answer
160 views
How to structure even number of board of directors?
We are in the process of setting up a board structure for our startup. Everybody on the board will have their own veto rights on important matters, such as capital injection, spending limits, getting ...
3
votes
3answers
220 views
Establishing shared ownership
What is a reasonable software start-up ownership share between founders when one is more senior, putting in some of his own money and able to raise angel money from friends, while the other two are ...
3
votes
3answers
2k views
How to determine share value for a new company?
I'm in the process of setting up a company, and am trying to figure out what numbers to put in the Share Structure Table in the company registration form (download here).
I will be the sole Director ...
3
votes
1answer
131 views
Impact of acquisition on shareholders
SCENARIO
I'm an early employee in a startup and 100% vested. I've been in the company long enough to start thinking about my next career step (MBA maybe), but I do wish it the best of success and ...
3
votes
2answers
409 views
Gross profit royalties vs non-voting equity
I began work with a small startup last year, working as a consultant. Consulting didn't last long because I saw great potential in the company and made it clear I wanted to be a part of it.
I ended ...
3
votes
0answers
116 views
Equity for First paid Tech-employee in a not-profitable financed Startup
I'm trying to be as specific as possible here:
We are a Startup 5 months on the go with three co-founders. Since none of us can truly code we need to employ our first Web-developer and we have found ...
2
votes
6answers
916 views
How much equity am I worth?
I had a problem that required a database solution. I designed the concept of the database and over a 2 year period developed a crude system that worked.
In trying to find help with the programming ...
2
votes
2answers
140 views
Can a firm buy itself?
Suppose you got scammed by an incubator, who is however apparently willing to sell his shares (which are now worth a couple times more than the initial injection (which effectively did nothing))
...
2
votes
2answers
522 views
Paying Friend/Programmer/Developer to code Startup Website. Also give Percentage? How to keep Accountable?
I have an income and a website idea. I know nothing about programming. I have a friend who is a programmer, comp-sci major, and so to get my idea created into a website I am paying them an hourly wage ...
2
votes
3answers
299 views
Why split equity at the beginning?
One of my co-founders is suggesting that we split equity based upon the number of hours each person puts in until we obtain funding and begin drawing salaries.
In other words, each person would be ...
2
votes
2answers
291 views
Proper way to get share in US company for non-US citizen
I was working for quite a time with US company which is S Corporation.
Now we are planning to continue as partners and I should get 10% of the company.
As far as I understand I cant be a shareholder ...
2
votes
2answers
210 views
Share value based on 5 year cash flow projection
I am about to embark on raising money. I am reasonably sure that I have constructed an accurate but very conservative 5 year plan.
If the cash flows are to be believed, I will now have to pin a value ...
2
votes
1answer
397 views
Profit shares vs voting shares
My co-founders and I plan to issue profit shares and voting shares separately. For example, I might receive 35% of the profit shares, and 15% of the voting shares.
What disadvantages are there to ...
2
votes
3answers
1k views
Co-founders unequal shares but how about initial capital injection?
Currently I'm working on a project together with 1 co-founder and soon we are going to incorporate a company. We agreed that I get 70% shares and he gets 30% . The reason is because I started the ...
2
votes
2answers
379 views
Full-time vs part-time and equity
At the moment, my co-founders and I are working on our startup part-time. We're in the process of figuring out how many shares to allocate to each person.
If one of us quits their full-time job to ...
2
votes
1answer
77 views
Share ownership in software spinoff
I have been employed at a research consulting company for several years. During the course of running research projects, I have developed software that I use internally to run some of my projects. ...
2
votes
2answers
497 views
Under what conditions can a C corp authorize new shares?
Under what conditions can a C corp increase the total number of shares authorized?
Board approval? Majority shareholder approval? Unanimous shareholder approval?
2
votes
1answer
295 views
Investor Share Dilution Protection
When an investor invests an amount in a startup company exchange for equity, how do they protect themselves from being significantly diluted by a larger investor? And is that even an issue?
2
votes
1answer
321 views
C Corporation single shareholder / highly-compensated employee limitations?
If I'm a single shareholder/owner and employee of a C Corporation, am I limited from taking any deductions due to being a highly-compensated employee (due to share ownership)?
2
votes
2answers
66 views
Reporting Founder Changes to the IRS
Last year, I incorporated with two other people who, at the time, were all about the project on which we were working. The project eventually fell flat due to loss of interest on their parts.
I've ...
2
votes
1answer
84 views
Equity in a business driven by software?
I am completely new to negotiating equity, and I don't know where I stand with regards to pushing back on potential offers of equity based on a new project.
If anybody could give me their view on my ...
2
votes
2answers
88 views
New shareholder class for special dividend?
This is more so theory than plans, and this is the only stack exchange that talks about corporate structure
Is it possible to make a new shareholder class, arbitrarily, solely for the distribution of ...
1
vote
2answers
480 views
How much equity is a business plan worth?
Say one person comes up with the idea for a startup, and spends a significant amount of time over 2 years developing the business plan. That person then asks others to join the startup as co-founders ...
1
vote
2answers
1k views
Internet startup - ownership share - developers vs biz people?
this is really good advice about ownership shares in a startup company.
But the advice is also very general. E.g. in the startup phase developers are extremely important - without them - there is no ...
1
vote
3answers
403 views
Dividing equity among cofounders when one person is doing most of the work
I shared my startup idea with two of my best friends and it seemed like a great thing to do at the time. The entire thing basically revolves around a particular kind of content and let's just say that ...
1
vote
3answers
330 views
Re-evaluating founders' equity
When founders divide a startup's equity amongst themselves, are those numbers set in stone (ignoring future dilution)?
I ask this because my co-founders and I are pondering whether we should ...
1
vote
3answers
212 views
Start-up Company - Legal Advice and beyond…Where do I go from here?
My question is pretty broad, but I am just wondering the next logical steps to take in establishing and distributing equity in an iOS App Business Startup.
What form or document do I would need to ...
1
vote
3answers
76 views
Issuing shares to advisor and dealing with fractional shares
We just incorporated and are now bringing on board an advisor. We want to give him %1. Our company consists of me and two co-founders, each with 1 million shares. Our total authorized shares are 5 ...
1
vote
1answer
59 views
Tricky Stock Creation Scenario
My partners and I own a couple business'. They are both LLC's. We want to start a third as a shell corporation which will own the other two by way of shares not the LLC partner names on everything ...
1
vote
1answer
136 views
How to handle a leaving employee's shares
I have a question about what are the best exit options for employees that own shares in a company and want to leave after some time.
For example, let's say at the start of a company the first ...
