4 ms·

There are a few concerns, but I am not sure I'd say you are being taken advantage of (yet). Concerns I'd have: 1. By not incorporating a new company, any past

There are a few concerns, but I am not sure I'd say you are being taken advantage of (yet). Concerns I'd have: 1. By not incorporating a new company, any past liabilities that the old company may have could haunt the new venture. This typically comes true when suddenly it goes from a small business with small revenues to a business worth suing because there is real money at stake. Of course, being in Canada might help as it isn't as litigious as the US from what I understand, but I could be wrong. 2. They are family, the one key thing to be aware of when working with families (yours or not) is it can be a nightmare. I spent the vast majority of my childhood and early adulthood working in family businesses (tech and otherwise), my family worked really hard to not do what most do in the business but it was a daily effort to be aware of it. Family fights different, family will stick together over almost all else (yes there are exceptions) and you being the outsider might be used as a weapon on either side which puts you in the middle. e.g. Son wants to go one way, Dad wants another, You may agree more with Son so then he'll use you against the Dad to get (or try to) his way. Not saying it is always like this, but I also consulted for years and dealt with family businesses and always saw patterns of strange behavior you wouldn't see otherwise. 3. The equity just doesn't make sense, unless they are giving you a different share class which could be really bad. This is again where it isn't clean so I'd be cautious and get more details first. In the end, these maybe great people and you may all work super well together and this will all be fine. It will boil down to your level of comfort and trust with them. My 2 cents, if you trust them, just get them to put everything in writing and have an outside legal advisor go over it for you. You don't have to get a lawyer to negotiate it or be confrontational, just get some advice and make sure it makes sense and you are covered. If you don't trust them or your gut says they are trying to pull something on you, run and run fast.

madhorse 8y ago
Thanks for your answer I’m not too scared about the family part, I came in acutely aware that it could be an issue but after working with them it seems to be a non problem. The part I’m most confused about is the equity, it doesn’t seem to be a standard way of doing things in the startup world.
- davismwfl 8y ago
  The equity isn't standard and it is odd. Only you can make this call. But if nothing else it seems odd. One point, 98% of all business are not managed or dealt with as a startup like SV would. I have been apart of a lot of businesses outside of SV and so many were not structured as you'd expect based on reading tech blogs etc, but a few were super lucrative for me. SV is an echo chamber, don't use it as your only source of reality as it is really an isolated odd case of reality.

madhorse 8y ago

Thanks for your answer I’m not too scared about the family part, I came in acutely aware that it could be an issue but after working with them it seems to be a non problem. The part I’m most confused about is the equity, it doesn’t seem to be a standard way of doing things in the startup world.

davismwfl 8y ago
The equity isn't standard and it is odd. Only you can make this call. But if nothing else it seems odd. One point, 98% of all business are not managed or dealt with as a startup like SV would. I have been apart of a lot of businesses outside of SV and so many were not structured as you'd expect based on reading tech blogs etc, but a few were super lucrative for me. SV is an echo chamber, don't use it as your only source of reality as it is really an isolated odd case of reality.