If this person was an EMPLOYEE, I'd say it's fine. As long as its happening on his own time, all the power to him. But this is your co-founder. Personally, I w

If this person was an EMPLOYEE, I'd say it's fine. As long as its happening on his own time, all the power to him. But this is your co-founder. Personally, I would be very concerned about why my co-founder was taking his eye off the ball and focusing on enriching himself. Startups are hard and cannot sustain split attention or split finances. The founders, in my opinion, need to be sacrificial and fanatical about the business. It's not that I think what he's doing is legally or even morally wrong. I just think it's a big red flag that he's not on a shared mission with you and lacks the focus and drive necessary to succeed. I couldn't go into business with someone who wasn't as invested in the business as I am.