3 ms·

I agree except that 'taking an operating role in the business' is a big grey area. For example, I could see someone meeting (1) & (2) but merely providing some

by plamb 16y ago

I agree except that 'taking an operating role in the business' is a big grey area. For example, I could see someone meeting (1) & (2) but merely providing some of the graphics for your first prototype. This may be crucial to your first prototype, but it is an extremely replaceable skill-set and it is not crucial to the longevity of the company. This person should not be considered a co-founder of your business. Now say the same person helps out with product development, takes over marketing and demonstrates that he can one day manage people and you've got someone who is less replaceable and more of a co-founder. Therefore, I think you need to make really clear what you mean by 'operating role in the business' before you make decisions about co-founders

su0mynona 16y ago
Well, an operating role is just a term that separates someone from being just a highly paid advisor. I’m assuming here all parties are reasonable about what they give equity for and we’re talking about a start up that can really go big. In this case, if someone is getting even 1%+ equity (even on a on a vesting schedule), they’re likely contributing a lot more than just mockups. So if they’re doing something, it’s early stage for little or no pay, I think the point where someone is getting close to 10% is a signal that they’re contributing enough to make them a co-founder. I don’t think replaceability matters in defining a co-founder. Talent is usually replaceable. Being a co-founder is more about being able to assume significant risk in the face of uncertainty to build a business. Just because someone contributes a lot to lifting a business off the ground doesn’t mean they’ll do the same later, or contribute to it's "longevity." Many times someone that works well in a 1-3 person start up might not fit as well as a manager or when the company has 500+ employees. However that still doesn’t take away from them being a co-founder.

by plamb 16y ago

su0mynona 16y ago

Well, an operating role is just a term that separates someone from being just a highly paid advisor. I’m assuming here all parties are reasonable about what they give equity for and we’re talking about a start up that can really go big. In this case, if someone is getting even 1%+ equity (even on a on a vesting schedule), they’re likely contributing a lot more than just mockups. So if they’re doing something, it’s early stage for little or no pay, I think the point where someone is getting close to 10% is a signal that they’re contributing enough to make them a co-founder. I don’t think replaceability matters in defining a co-founder. Talent is usually replaceable. Being a co-founder is more about being able to assume significant risk in the face of uncertainty to build a business. Just because someone contributes a lot to lifting a business off the ground doesn’t mean they’ll do the same later, or contribute to it's "longevity." Many times someone that works well in a 1-3 person start up might not fit as well as a manager or when the company has 500+ employees. However that still doesn’t take away from them being a co-founder.