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Every time I have negotiated hard regarding a situation like this, I have regretted it. The reason is that in this moment, you feel the work you've done must b

Every time I have negotiated hard regarding a situation like this, I have regretted it. The reason is that in this moment, you feel the work you've done must be worth a lot, because it is fresh in your mind, and because cognitive dissonance dictates you believe you haven't wasted all those hours of coding. Meanwhile you are still imagining the big payoff from the company succeeding ... which is a great motivator when you're working on the startup, but when you are parting ways, you should remember being super successful is incredibly rare. You would benefit from bringing rationality in and remembering it was all always a long shot. So you will tend to overvalue the company, based on the work you've done, while undervaluing the personal relationships and lessons learned. Take a long view. Do whatever deal will make your cofounder happy. Be nice in every way to every one involved, make good on any promises, and give it time. When you look back on this a year from now you will be glad you did.

Uptrenda 11y ago
I wish I had of read this when I was in a similar position. I would still have my best friend.
- scott_s 11y ago
  Send them an apology with a link to this comment, and you may still. (Personally, I found your comment heart breaking, and I hope you can mend the relationship.)
  - deleted 11y ago
    [deleted]
  - nothrabannosir 11y ago
    Great idea, though maybe leave out the link.
- kngspook 11y ago
  If it hasn't been very long, but still long enough for them to get some space and perspective, then I second scott_s' advice. They might feel the same way, and you might come back together stronger than you were before. If it's been too long, I think it's still worth a shot, but you're more likely to have a cordial but somewhat distant relationship rather than a return to best-friendship.
endymi0n 11y ago
Can't +1 this enough. When I left that company back then, they compensated me with 5k for my equity, which would have been worth 50k and potentially much much more at an exit. However mad I was about it back then, it cleared up my mind by being an end to something and let me focus on something new. Just 2 years later, I'm cofounder of something great and that former company is falling apart. My 5k might have been the only equity being paid out from that company ever and it paid the bed I'm sleeping on every day. Take the high road and the long view.
- pc86 11y ago
  I too received $5k for my 15% of a startup (I came on after the tech cofounder left, and took over that role but 90% of my time was development as opposed to truly CTO-level work). At the time felt it was a pittance given the number of hours I had put in, and from an hourly rate perspective it probably was, but the company was never profitable and was operating solely on the founder's capital. As is the case 95+% of the time, the company closed a year or two later, as far as I know having never made a profit.
  - rrecuero 11y ago
    Exactly! I haven't heard of any companies in this stage that loose a cofounder and then become successful. Until you get to product market fit, the company is worth pretty much nothing. If you want your cofounders to have at least a shot, giving them your equity in exchange of some small amount sounds the more reasonable and civilized way to go.
GrinningFool 11y ago
Very well said. Particularly when first starting out career-wise, the time and effort spent on something like this appear disproportionately large. Though ... remembering myself when I was first starting out - this advise will be likely be hard to accept and act on.
crikli 11y ago
Solid advice with one exception: you may not be able to make a deal that makes your cofounder happy. Even if you're as nice as you can be, make good, on promises, etc, you may still end up being "the bad guy." Emotion is the enemy of rational thinking and there's going to be a lot of emotion here given the commingling of your personal and business investments. You have to evaluate your behavior on the clarity of your own conscience, not on the communicated perceptions of the other party.
- grossvogel 11y ago
  Maybe OP's co-founder should see this thread, too.
  - TeMPOraL 11y ago
    Agree with this strongly. If situation is that complex, both parties will have to go meta to resolve it - look at it from above, realize the tangled mess of emotions and expectations they're in and that no one wishes the other anything bad, that it's just hard to let go. In my experience, it's hard to go meta together, but if you can successfully communicate: "I'm on your side, lets ascend together and look at it from far above", you both win.
kaizendad 11y ago
This, seriously. The reality is that you're leaving a company that has /no value/. It may have a number of pieces to get to value, but you're nowhere yet. Sometime, in the future, some set of pieces may come together that will give this company value; but they don't exist now. ( When I say value, I don't just mean profit; if you can't merge with another company in the space, or sell your code to another company in the space... No value.) If it's just time and sweat to get to value, then don't leave! Take a vacation. Come back ready to make it work. If it's time and sweat + some set of technology and business process innovations = value, then allow the cofounder who sticks with it to reap their reward, while you reap a different reward for different work.
- curun1r 11y ago
  > The reality is that you're leaving a company that has /no value/ From the sound of it, that's probably not even true...the company actually has negative value. The seed money wasn't given as investment, it was a loan. It doesn't sound like they've been able to create $10k of value to offset the liability of the loan. If the poster is able to walk away without having to pay back their share of that loan, they should probably count themselves lucky.
MajorLOL 11y ago
Great post. The only add I can include is; what good is fighting hard for a piece of nothing? You aren't going to milk much out of this as it is. Stay on good terms! Maybe the idea isn't there yet, maybe it will blow up in 5 years. What if its the next Facebook? Do you want to be remembered as the asshole who fought over a couple thousand dollars in the beginning or someone fondly remembered, well connected with the owners of the new Facebook? :D
austenallred 11y ago
You also need to realize that should anything successful come out of the startup your contribution will be almost negligible compared to all of the work that goes in from this point. I had an amiable co-founder breakup, and he still has a percentage of the company, but every day the proportion of the work that was done with that former co-founder grows smaller. We're kind of the same idea, but definitely not the same product, about 10 iterations further, an entire team of people who have been working nonstop for a year, millions of dollars of money risked, etc. I still am grateful for the work he put in, but it's now a tiny, tiny piece of the overall puzzle... It just takes so much to be successful that the "idea" can't be worth much. I still plan on hooking my former cofounder up if/when we have an exit, but recognize that if you take a large percentage it will make every aspect of the company incredibly difficult, especially when it comes to fundraising.

Uptrenda 11y ago

I wish I had of read this when I was in a similar position. I would still have my best friend.

scott_s 11y ago
Send them an apology with a link to this comment, and you may still. (Personally, I found your comment heart breaking, and I hope you can mend the relationship.)
- deleted 11y ago
  [deleted]
- nothrabannosir 11y ago
  Great idea, though maybe leave out the link.
kngspook 11y ago
If it hasn't been very long, but still long enough for them to get some space and perspective, then I second scott_s' advice. They might feel the same way, and you might come back together stronger than you were before. If it's been too long, I think it's still worth a shot, but you're more likely to have a cordial but somewhat distant relationship rather than a return to best-friendship.

endymi0n 11y ago

Can't +1 this enough. When I left that company back then, they compensated me with 5k for my equity, which would have been worth 50k and potentially much much more at an exit. However mad I was about it back then, it cleared up my mind by being an end to something and let me focus on something new. Just 2 years later, I'm cofounder of something great and that former company is falling apart. My 5k might have been the only equity being paid out from that company ever and it paid the bed I'm sleeping on every day. Take the high road and the long view.

pc86 11y ago
I too received $5k for my 15% of a startup (I came on after the tech cofounder left, and took over that role but 90% of my time was development as opposed to truly CTO-level work). At the time felt it was a pittance given the number of hours I had put in, and from an hourly rate perspective it probably was, but the company was never profitable and was operating solely on the founder's capital. As is the case 95+% of the time, the company closed a year or two later, as far as I know having never made a profit.
- rrecuero 11y ago
  Exactly! I haven't heard of any companies in this stage that loose a cofounder and then become successful. Until you get to product market fit, the company is worth pretty much nothing. If you want your cofounders to have at least a shot, giving them your equity in exchange of some small amount sounds the more reasonable and civilized way to go.

GrinningFool 11y ago

Very well said. Particularly when first starting out career-wise, the time and effort spent on something like this appear disproportionately large. Though ... remembering myself when I was first starting out - this advise will be likely be hard to accept and act on.

crikli 11y ago

Solid advice with one exception: you may not be able to make a deal that makes your cofounder happy. Even if you're as nice as you can be, make good, on promises, etc, you may still end up being "the bad guy." Emotion is the enemy of rational thinking and there's going to be a lot of emotion here given the commingling of your personal and business investments. You have to evaluate your behavior on the clarity of your own conscience, not on the communicated perceptions of the other party.

grossvogel 11y ago
Maybe OP's co-founder should see this thread, too.
- TeMPOraL 11y ago
  Agree with this strongly. If situation is that complex, both parties will have to go meta to resolve it - look at it from above, realize the tangled mess of emotions and expectations they're in and that no one wishes the other anything bad, that it's just hard to let go. In my experience, it's hard to go meta together, but if you can successfully communicate: "I'm on your side, lets ascend together and look at it from far above", you both win.

kaizendad 11y ago

This, seriously. The reality is that you're leaving a company that has /no value/. It may have a number of pieces to get to value, but you're nowhere yet. Sometime, in the future, some set of pieces may come together that will give this company value; but they don't exist now. ( When I say value, I don't just mean profit; if you can't merge with another company in the space, or sell your code to another company in the space... No value.) If it's just time and sweat to get to value, then don't leave! Take a vacation. Come back ready to make it work. If it's time and sweat + some set of technology and business process innovations = value, then allow the cofounder who sticks with it to reap their reward, while you reap a different reward for different work.

curun1r 11y ago
> The reality is that you're leaving a company that has /no value/ From the sound of it, that's probably not even true...the company actually has negative value. The seed money wasn't given as investment, it was a loan. It doesn't sound like they've been able to create $10k of value to offset the liability of the loan. If the poster is able to walk away without having to pay back their share of that loan, they should probably count themselves lucky.

MajorLOL 11y ago

Great post. The only add I can include is; what good is fighting hard for a piece of nothing? You aren't going to milk much out of this as it is. Stay on good terms! Maybe the idea isn't there yet, maybe it will blow up in 5 years. What if its the next Facebook? Do you want to be remembered as the asshole who fought over a couple thousand dollars in the beginning or someone fondly remembered, well connected with the owners of the new Facebook? :D

austenallred 11y ago

You also need to realize that should anything successful come out of the startup your contribution will be almost negligible compared to all of the work that goes in from this point. I had an amiable co-founder breakup, and he still has a percentage of the company, but every day the proportion of the work that was done with that former co-founder grows smaller. We're kind of the same idea, but definitely not the same product, about 10 iterations further, an entire team of people who have been working nonstop for a year, millions of dollars of money risked, etc. I still am grateful for the work he put in, but it's now a tiny, tiny piece of the overall puzzle... It just takes so much to be successful that the "idea" can't be worth much. I still plan on hooking my former cofounder up if/when we have an exit, but recognize that if you take a large percentage it will make every aspect of the company incredibly difficult, especially when it comes to fundraising.