10 ms·

The marketing guy, I found on YC Startup School Co-Founder Match (https://www.startupschool.org/ https://www.startupschool.org/), the Developer was creating Gra

The marketing guy, I found on YC Startup School Co-Founder Match (https://www.startupschool.org/ https://www.startupschool.org/), the Developer was creating GraphQL Open Source projects that were related to what I was building, so I've got in touch with them. I can definitely recommend Startup School, it helped me build a lot of useful connections.

jasfi 4y ago
How did you determine how to split equity? Edit: I'm not looking for actual %s, just the factors involved.
- alex_suzuki 4y ago
  Would like to know as well. This is tricky, as all your assets are probably intellectual property and hard to put a price tag on. Also some people have a hard time accepting that they are eligible for a smaller piece of the cake than you are.
  - leetrout 4y ago
    Random thought on this: I do not personally believe the owner of the idea is worth more than 10% of equity. They have to be contributing something to get more. It may be capital, it may be sales but it has to be something. I dream to start a company where I am able to steer almost every decision and the company shares automatically reduce my ownership over X years until a kind of coop forms and most employees have enough equity as a group to control the company. Give away control to put the right incentives on hiring. Also none of this 1 year cliff vesting nonsense. If you are willing to join a startup I am willing to give you equity immediately.
    - pirate787 4y ago
      >none of this 1 year cliff vesting nonsense It is foolish to give immediate equity to a new hire who hasn't proven themselves as a good worker and good fit.
      - leetrout 4y ago
        And they do not have to be there for a long time to start providing immense value.
      - alex_suzuki 4y ago
        Totally agree, feels really naive.
- jensneuse 4y ago
  You know you've got the right equity split when everybody thinks it's fair and the team can focus 100% on execution. Factors can be time spent on the project, experience, who "owns" what, connections, etc... But in the end, if you have to discuss this topic too much with someone, you know it's not going to work. If the Co-Founders cannot easily come to the same result, their mindset doesn't align well enough, which can be a risk for the whole operation. So, I'd advise against haggling too much, for both sides. Also, I'd suggest to discuss this topic very early on. Don't waste time if you don't know their expectations are in the same ballpark as yours. If you get the right people to commit helping you, I'd rather give them more equity, when the other option is to keep doing this on my own forever. Ideally, you can all "start" at the same time and split equity equally, but the reality is that you don't have all the stars aligned on day one.
- mns06 4y ago
  a cofounder and I used this system for a previous company: https://slicingpie.com/ https://slicingpie.com/ It worked pretty well for us, but we were also pretty well tuned to each others expectations in advance.

jasfi 4y ago

How did you determine how to split equity? Edit: I'm not looking for actual %s, just the factors involved.

alex_suzuki 4y ago
Would like to know as well. This is tricky, as all your assets are probably intellectual property and hard to put a price tag on. Also some people have a hard time accepting that they are eligible for a smaller piece of the cake than you are.
- leetrout 4y ago
  Random thought on this: I do not personally believe the owner of the idea is worth more than 10% of equity. They have to be contributing something to get more. It may be capital, it may be sales but it has to be something. I dream to start a company where I am able to steer almost every decision and the company shares automatically reduce my ownership over X years until a kind of coop forms and most employees have enough equity as a group to control the company. Give away control to put the right incentives on hiring. Also none of this 1 year cliff vesting nonsense. If you are willing to join a startup I am willing to give you equity immediately.
  - pirate787 4y ago
    >none of this 1 year cliff vesting nonsense It is foolish to give immediate equity to a new hire who hasn't proven themselves as a good worker and good fit.
    - leetrout 4y ago
      And they do not have to be there for a long time to start providing immense value.
    - alex_suzuki 4y ago
      Totally agree, feels really naive.
jensneuse 4y ago
You know you've got the right equity split when everybody thinks it's fair and the team can focus 100% on execution. Factors can be time spent on the project, experience, who "owns" what, connections, etc... But in the end, if you have to discuss this topic too much with someone, you know it's not going to work. If the Co-Founders cannot easily come to the same result, their mindset doesn't align well enough, which can be a risk for the whole operation. So, I'd advise against haggling too much, for both sides. Also, I'd suggest to discuss this topic very early on. Don't waste time if you don't know their expectations are in the same ballpark as yours. If you get the right people to commit helping you, I'd rather give them more equity, when the other option is to keep doing this on my own forever. Ideally, you can all "start" at the same time and split equity equally, but the reality is that you don't have all the stars aligned on day one.
mns06 4y ago
a cofounder and I used this system for a previous company: https://slicingpie.com/ https://slicingpie.com/ It worked pretty well for us, but we were also pretty well tuned to each others expectations in advance.