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"Done much yet" and "joined later" don't really matter much, in my book-- as I said, the question is, when we look back at some future point (say, a year or two
by michael_dorfman 16y ago
"Done much yet" and "joined later" don't really matter much, in my book-- as I said, the question is, when we look back at some future point (say, a year or two from now) and total up all of the contributions, how much value did each person provide?
Clearly, person A has contributed the most so far. That doesn't mean that the trend will continue that way.
- generalk 16y agoYou don't assign equity based on work that isn't done. That's asking for trouble, unless the person has a huge track record of doing the type of work you have them doing. Vesting is key here. I'm not the first to say it, but setting up key milestones and vesting based on their successful (and be sure to define "success") completion is the only way to go.
- petervandijck 16y agoQuestion: I hadn't heard of vesting based on milestones before. Is that really a commonly used option? Since milestones are so hard to predict, and depend on lots of factors, not just the work of that one person..
- petervandijck 16y agoNo. You shouldn't give equity now based on an imaginary look-back from the future, because it is impossible to predict the future, that's my whole point. PersonB may contribute later, but at that point there will be a lot of existing value already, hence, even if they add more value, the percentage of value they add is less, and the risk they take is a lot less (since there is already value there), hence they get a lot less equity. How early you join makes ALL the difference.
- michael_dorfman 16y agoRe-read the question. It is early. The code hasn't been written. The risk is still astronomical.
- petervandijck 16y agoSo if I join Google today and I come up with another billion dollar income stream for them, I'll get as rich as the founders? No. That's not how it works, sorry.
- michael_dorfman 16y agoWe're talking pre-launch here. From the sounds of it, the value created thus far is negligible in the larger scheme of things.
- tptacek 16y agoActually: while I think the "person B hasn't done much real work yet" logic doesn't really work, joining later definitely is relevant to your equity. Person C is taking less risk than A and B; A and B need to be compensated for that.