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I assume this is in the US. At a small startup, I assume you'd frequently talk with the founders and could just share your concerns directly. If you don't trust

I assume this is in the US. At a small startup, I assume you'd frequently talk with the founders and could just share your concerns directly. If you don't trust the founders to be honest with you, then you may not want to join the company in a larger capacity. Regarding the "leverage", neglecting to have you sign an IP transfer agreement would be a major oversight by the founders and a potential red flag. I wonder how many founders are there and their roles? Are they fulltime? Is there a CTO? Or are the two contracted developers fully in charge of the product? It then comes down to what role you're looking for in the company, beyond being a contractor. Also, how are they currently funded? Are they about to raise a seed round? You suggest your stock "options" aren't worth much. However, if the company is brand new and you're paid less than a market salary, then it's possible that owning substantial stock would be appropriate.

outsoser 4y ago
If I can change the situation, I will be a part of this team. The tech team has been treated as full-time employees for the last two years in terms of being available from 9 to 6, doing daily standups, reporting that the work gets done, sending sick leave emails, and cutting money because of that "skipped" days. Never get any "paid holidays" or something. Most of the time, my rate was less than 25usd per hour. Taking the worst part of being a contractor and employee is my daily life. This is our first "international job" for the second developer and me. Hence, we were happy just taking it and believing in the founder's promises of higher salary and equity options. If trusted to my profile on carta.com, the options equity is about 0.8%. My friends with experience in startups said it's ridiculous. Only a tiny contractor's hourly rate with a small amount of equity for such hard work to make the company profitable. We did it but got no bonuses besides "Thank you! Let's work harder!"
- psyklic 4y ago
  It sounds like you initially found the terms acceptable but now less so. From a contracting perspective, I'd decide what terms would make you happy then present them to the founders. The founders might not realize that you feel this way (or they might just poorly express themselves virtually). You might let them know you want to be a team member, then show some examples why you don't feel that way now. This might help explain it. Funding could give the founders more flexibility to pay you. I'd also keep in mind from their perspective it will be more difficult to make you an employee than someone in the US. Maybe you could help by presenting how you believe the process would work? FWIW things could be worse. In the first startup I co-founded, I received both a lower hourly rate and less equity than you (though without my knowledge).

outsoser 4y ago

If I can change the situation, I will be a part of this team. The tech team has been treated as full-time employees for the last two years in terms of being available from 9 to 6, doing daily standups, reporting that the work gets done, sending sick leave emails, and cutting money because of that "skipped" days. Never get any "paid holidays" or something. Most of the time, my rate was less than 25usd per hour. Taking the worst part of being a contractor and employee is my daily life. This is our first "international job" for the second developer and me. Hence, we were happy just taking it and believing in the founder's promises of higher salary and equity options. If trusted to my profile on carta.com, the options equity is about 0.8%. My friends with experience in startups said it's ridiculous. Only a tiny contractor's hourly rate with a small amount of equity for such hard work to make the company profitable. We did it but got no bonuses besides "Thank you! Let's work harder!"

psyklic 4y ago
It sounds like you initially found the terms acceptable but now less so. From a contracting perspective, I'd decide what terms would make you happy then present them to the founders. The founders might not realize that you feel this way (or they might just poorly express themselves virtually). You might let them know you want to be a team member, then show some examples why you don't feel that way now. This might help explain it. Funding could give the founders more flexibility to pay you. I'd also keep in mind from their perspective it will be more difficult to make you an employee than someone in the US. Maybe you could help by presenting how you believe the process would work? FWIW things could be worse. In the first startup I co-founded, I received both a lower hourly rate and less equity than you (though without my knowledge).