4 ms·

The situation he describes is a lot more common then you guys probably think. Amazing things happen in a great partnership, but it's as rare as breakaway succe

• petenixey 16y ago
  Tobi, you guys have done very well, what was the early story for you?
  • revorad 16y ago
    http://mixergy.com/tobias-lutke-shopify-interview/ http://mixergy.com/tobias-lutke-shopify-interview/
• zackattack 16y ago
  why is 50/50 the dumbest way to start a company?
  • xal 16y ago
    because it pretends that 2 people of exactly the same value to the company. What are the odds of that?
    • KleinmanB 16y ago
      Hah! 50/50 of a new company is ZERO. If you are negotiating your "future value" (aggressively) with the person you are partnering with (and betting that they will pour their blood into to build the initial value), you probably have the wrong priorities to begin with. Just taking the risk, starting at zero and pushing through the early phases is HUGELY valuable. That's why VCs don't start companies (This advice changes a bit for well known, serial founders)
      • krschultz 16y ago
        That is looking at it from a valuation standpoint, from my perspective 51/49 is much better than 50/50. When push comes to shove, and you are 50/50, you are at a stalemate.
        • michaelfairley 16y ago
          If push comes to shove in a 2 person company, the company is already dead, regardless of the equity split.
          • gregpilling 16y ago
            I agree and would add that even in a 20 person company it is better (much better) to get agreement rather than trying to make a decision stick because you have 51% ownership. I have done that in the past, and it is amazing how long people can hold onto their dislike of your decision and try to 'get back' at you later. Forcing your will because you have majority is not good for anything. Companies need to have a clear leader, and leadership does not come from a 2% difference. This is from my previous company of 20 people where I had majority interest.
        • brudgers 16y ago
          Listening to Suster, I'd evaluate a bigger differential so that control can better survive dilution. For example, at 65/35 a single person could maintain control through 20% dilution. For YC a split of 57/43 would guarantee control through their investment.
      • mediaman 16y ago
        The problem is that while 50/50 can work, it rarely does, and it's nearly impossible to tell at the beginning whether it will, unless you have already had such an arrangement with someone and it worked well with them. Sometimes it works well for a number of years, and then, at some later point, priorities change or differences emerge, or a culture clash happens, and the partners can have their own 'camps' of people, who sometimes don't get along. In most cases it is better to have one person set the culture and long-term objectives of the company. However, they can and should start with other partners, who can have significant influence on both of those aims; with a good CEO it can even at times appear undifferentiable from equality, but at the end of the day one person should have the ability to call the decision to eliminate stalemates.
  • damoncali 16y ago
    It's not. Sometimes it works wonderfully.