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Paul Graham's "The Equity Equation" (http://paulgraham.com/equity.html http://paulgraham.com/equity.html) clarified my thinking on this. In brief, if average o

Paul Graham's "The Equity Equation" (http://paulgraham.com/equity.html http://paulgraham.com/equity.html) clarified my thinking on this. In brief, if average outcome of the company is $X right now, and would be $Y with the new cofounders, you should be happy giving away X/Y of the company.

gdee 18y ago
So if $X (suppose) is $1000 and $Y would be $5000, I should be happy to part with a fifth of the company. You're SO right. Yet wrong.
- mattmaroon 18y ago
  If a cofounder is good enough that the company is 5x as valuable with him, it speaks very poorly of you.
  - shadytrees 18y ago
    I think the point being made was that the equation given (I haven't read the article, only this thread.) implies if X = $1000 and Y = $1001, then you should give away X/Y or 99.9% of the company. I think it should be "keep", not "give away". Or, alternatively, give away (Y-X)/Y.
  - gdee 18y ago
    Big, round numbers make for easy examples. Picking on examples makes...
MaysonL 18y ago
Actually, you should be happy keeping X/Y or more: thus giving away up to (Y-X)/Y.