5 ms·

You can't really get good advice from strangers on the internet, you really need to talk to a lawyer and dig into the details, and even finding the right lawyer

You can't really get good advice from strangers on the internet, you really need to talk to a lawyer and dig into the details, and even finding the right lawyer can be a very hard problem, so try to ask around to other technologists in your area and see if there are contract lawyers they have been happy to work with. (edit: And to be clear, a good lawyer is 10% the written details in the contract and laws and regs and 90% understanding the relationship dynamics and your interests, being able to suggest a range of written structures and terms that capture tradeoffs, and being able to negotiate effectively. Ideally, a counselor.) Some meta thoughts- * there are all kinds of contracts and all kinds of relationships. Reasonable is in the eyes of the beholders, and depends on what they value (the business vs the person, etc). I have heard of much better (for the developer) terms, and much worse, than yours. * from business perspective, the question ultimately is one of leverage. The question isn't how much you have contributed to the business- if your partner thinks that way then they value the relationship with you over the value to the business, and the terms you work out are dependent on how you value the relationship with them. * a business is acquired for the future value it will bring to new owners. The question there is how much is your future contributions are worth to the business. If you are not needed or are easily replaceable and the product is turn key, then your value is zero. If your contributions are needed, then your value is very high and you should try to structure the future relationship accordingly. Again, these are meta-thoughts only, the most important task is to try to find a good lawyer who is in your area and is familiar with these kinds of situations. Good luck.

x0x0 6y ago
As jonahbenton said, this isn't a matter of value or right/wrong, it's a matter of leverage. How hard would it be to replace you? You will probably have a pressure point that you can exploit with respect to the sale. ie you can refuse to work for potential new owners. Even if you are pretty replaceable, I think most potential buyers would be scared off by having to replace the sole software engineer who understands the codebase. eg the small software business sales I'm aware of typically come with commitments around the engineering staff. Be aware that doing this may burn your relationship with the current owner. As in all negotiations, make sure that you are actually willing to live with any options you bring up. Your rights here are so fact dependent that you must get legal counsel in your jurisdiction. One smart way to approach this negotiation would be to write a contract agreeing to a minimum work period for the potential new owners; as a cost, you would need some percent of the sale price. Again, you must get yourself a local attorney experienced in these types of negotiations. One point I would bring up though, is that engineers often wildly overestimate how easy it is to turn lines of code into cash. It is quite possible that the business end of this business holds all the leverage. When OP says eg he or she has "worked many hundreds of hours", this sounds like low maintenance software that the business owner can continue to sell for quite a long while without any ongoing engineering.
- mb_72 6y ago
  > How hard would it be to replace you? It wouldn't be easy, I don't believe, and I'm generally quite negative about my own development abilities and values. One point I couldn't fit into my original post is that I do have what I believe to be a good relationship with my business partner, but I feel he's disconnected from what valuable and capable developers make outside of his business. Also, he may well not be able to sell the business at all, and in that case he's suggested I could take over as manager (for higher pay), however I would be living with the potential sale hanging over my head, and not knowing whether this better-paid role would ever eventuate. > this sounds like low maintenance software that the business owner can continue to sell for quite a long while without any ongoing engineering. That's probably a fair statement, although there are normally updates we put out a few times a year due to changing business parameters in our market, and once every year we do a major release with new features.
  - harrisonjackson 6y ago
    If you are considering a new role with your partner with a new contract then that is a great chance to renegotiate so you see the upside of a sale. Going a bit beyond the OP - A difficult lesson for many engineers is that it doesn't matter what standard engineering salaries are. You could be the best engineer in the world but if you work for a low-revenue, non-tech company, then you aren't going to be compensated the same as you would at a tech company where revenue per employee is $2.2M (Netflix) or $2M (Apple) and engineers directly contribute to that revenue.
  - x0x0 6y ago
    I'm a hiring manager. We don't pay based on value, we pay based on competition for the hire. If the software doesn't require a lot of ongoing maintenance (it may! I have no idea!) and this business is already set up to handle remote asynchronous work, you may not have a strong negotiating position. Or you may -- perhaps it requires highly specialized skills. But you should make a non-emotional evaluation of (1) your replaceability, and (2) your business partner's opinion of your replaceability. If you want pay based on value, start a company you own.
  - 6y ago
ChrisMarshallNY 6y ago
> You can't really get good advice from strangers on the internet I really wish more people would take this to heart. I can't even begin to comment on the OP, as I am sure there's a lot of stuff left unsaid. My experience with "My work is the valuable part" is that it is often extremely one-dimensional, and fails to take into account a lot of "soft" factors, like marketing and brand-reinforcement; which are incredibly valuable, and look like "fluff" to hard-core developers. That said, I do think that "non-people" people can be abused and treated quite badly by slickers and carpetbaggers. Sounds like this is a very long-term relationship that has benefitted both parties, so I would gently suggest that spraying it all over HN may be adding gasoline to a fairly minor bit of flame.
notahacker 6y ago
> a business is acquired for the future value it will bring to new owners. The question there is how much is your future contributions are worth to the business. If you are not needed or are easily replaceable and the product is turn key, then your value is zero. If your contributions are needed, then your value is very high and you should try to structure the future relationship accordingly. On a related note, if the prospective buyer is likely to value your future services highly, the lowest friction way of getting decent money is likely to be focusing on ensuring any buyout has a high salary/earnout clause for you [rather than trying to renegotiate the original agreement]. That's especially the case if the buying company is used to paying some of its developers or product managers significantly higher salaries than your current income anyway.
mb_72 6y ago
Thanks for the reply. It's perhaps a sign of my confusion that I'm posting here on HN, however I figured there's a bunch of pretty smart and caring people who also wouldn't hesitate to provide direct and useful advice (and from the responses I've seen I'm not wrong about this). Regarding the 'soft' side of the business, what I couldn't fit into the original post due to maximum length is that I've been the driver behind improvements to sales and marketing - 2 new company websites, I do all the SEO, and I've suggested strategies like blogging etc in terms of getting new eyeballs to the product.
- charliemil4 6y ago
  This type of agreement is best pursued as a non-technical, non-legal endeavor. There’s a book “Never Split the Difference” by Chris Voss that will get you up to speed. His videos on YouTube are also potent. Ideally, you want to avoid the “I brought this” style of language; what else is someone to do than think, “well I brought this, too!” It gets especially tense if the evidence is too damming, so the protection mechanisms kick over rather than the empathy and cooperation channels. Good luck - you got this
  - mb_72 6y ago
    Thanks for the recommendation, and information, I've got that book on my Kindle now for tonight's reading.
mywacaday 6y ago
Just because you engage the services of a lawyer doesn't mean that the owner has to know about it. The correct lawyer will advise you on a strategy that should work in favour while maintaining the relationship with the owner.
puszczyk 6y ago
> You can't really get good advice from strangers on the internet I totally agree with this part, but I also think it’s valuable to get an option from the strangers because it may give you a different angle to look from or suggest things that you (or your lawyer) might’ve missed.

x0x0 6y ago

As jonahbenton said, this isn't a matter of value or right/wrong, it's a matter of leverage. How hard would it be to replace you? You will probably have a pressure point that you can exploit with respect to the sale. ie you can refuse to work for potential new owners. Even if you are pretty replaceable, I think most potential buyers would be scared off by having to replace the sole software engineer who understands the codebase. eg the small software business sales I'm aware of typically come with commitments around the engineering staff. Be aware that doing this may burn your relationship with the current owner. As in all negotiations, make sure that you are actually willing to live with any options you bring up. Your rights here are so fact dependent that you must get legal counsel in your jurisdiction. One smart way to approach this negotiation would be to write a contract agreeing to a minimum work period for the potential new owners; as a cost, you would need some percent of the sale price. Again, you must get yourself a local attorney experienced in these types of negotiations. One point I would bring up though, is that engineers often wildly overestimate how easy it is to turn lines of code into cash. It is quite possible that the business end of this business holds all the leverage. When OP says eg he or she has "worked many hundreds of hours", this sounds like low maintenance software that the business owner can continue to sell for quite a long while without any ongoing engineering.

mb_72 6y ago
> How hard would it be to replace you? It wouldn't be easy, I don't believe, and I'm generally quite negative about my own development abilities and values. One point I couldn't fit into my original post is that I do have what I believe to be a good relationship with my business partner, but I feel he's disconnected from what valuable and capable developers make outside of his business. Also, he may well not be able to sell the business at all, and in that case he's suggested I could take over as manager (for higher pay), however I would be living with the potential sale hanging over my head, and not knowing whether this better-paid role would ever eventuate. > this sounds like low maintenance software that the business owner can continue to sell for quite a long while without any ongoing engineering. That's probably a fair statement, although there are normally updates we put out a few times a year due to changing business parameters in our market, and once every year we do a major release with new features.
- harrisonjackson 6y ago
  If you are considering a new role with your partner with a new contract then that is a great chance to renegotiate so you see the upside of a sale. Going a bit beyond the OP - A difficult lesson for many engineers is that it doesn't matter what standard engineering salaries are. You could be the best engineer in the world but if you work for a low-revenue, non-tech company, then you aren't going to be compensated the same as you would at a tech company where revenue per employee is $2.2M (Netflix) or $2M (Apple) and engineers directly contribute to that revenue.
- x0x0 6y ago
  I'm a hiring manager. We don't pay based on value, we pay based on competition for the hire. If the software doesn't require a lot of ongoing maintenance (it may! I have no idea!) and this business is already set up to handle remote asynchronous work, you may not have a strong negotiating position. Or you may -- perhaps it requires highly specialized skills. But you should make a non-emotional evaluation of (1) your replaceability, and (2) your business partner's opinion of your replaceability. If you want pay based on value, start a company you own.
- 6y ago

ChrisMarshallNY 6y ago

> You can't really get good advice from strangers on the internet I really wish more people would take this to heart. I can't even begin to comment on the OP, as I am sure there's a lot of stuff left unsaid. My experience with "My work is the valuable part" is that it is often extremely one-dimensional, and fails to take into account a lot of "soft" factors, like marketing and brand-reinforcement; which are incredibly valuable, and look like "fluff" to hard-core developers. That said, I do think that "non-people" people can be abused and treated quite badly by slickers and carpetbaggers. Sounds like this is a very long-term relationship that has benefitted both parties, so I would gently suggest that spraying it all over HN may be adding gasoline to a fairly minor bit of flame.

notahacker 6y ago

> a business is acquired for the future value it will bring to new owners. The question there is how much is your future contributions are worth to the business. If you are not needed or are easily replaceable and the product is turn key, then your value is zero. If your contributions are needed, then your value is very high and you should try to structure the future relationship accordingly. On a related note, if the prospective buyer is likely to value your future services highly, the lowest friction way of getting decent money is likely to be focusing on ensuring any buyout has a high salary/earnout clause for you [rather than trying to renegotiate the original agreement]. That's especially the case if the buying company is used to paying some of its developers or product managers significantly higher salaries than your current income anyway.

mb_72 6y ago

Thanks for the reply. It's perhaps a sign of my confusion that I'm posting here on HN, however I figured there's a bunch of pretty smart and caring people who also wouldn't hesitate to provide direct and useful advice (and from the responses I've seen I'm not wrong about this). Regarding the 'soft' side of the business, what I couldn't fit into the original post due to maximum length is that I've been the driver behind improvements to sales and marketing - 2 new company websites, I do all the SEO, and I've suggested strategies like blogging etc in terms of getting new eyeballs to the product.

charliemil4 6y ago
This type of agreement is best pursued as a non-technical, non-legal endeavor. There’s a book “Never Split the Difference” by Chris Voss that will get you up to speed. His videos on YouTube are also potent. Ideally, you want to avoid the “I brought this” style of language; what else is someone to do than think, “well I brought this, too!” It gets especially tense if the evidence is too damming, so the protection mechanisms kick over rather than the empathy and cooperation channels. Good luck - you got this
- mb_72 6y ago
  Thanks for the recommendation, and information, I've got that book on my Kindle now for tonight's reading.

mywacaday 6y ago

Just because you engage the services of a lawyer doesn't mean that the owner has to know about it. The correct lawyer will advise you on a strategy that should work in favour while maintaining the relationship with the owner.

puszczyk 6y ago

> You can't really get good advice from strangers on the internet I totally agree with this part, but I also think it’s valuable to get an option from the strangers because it may give you a different angle to look from or suggest things that you (or your lawyer) might’ve missed.