The hazy picture I get is that you are a hustler and surrounded yourself with (as you say) risk averse employees. You made one of those employees a "co-founder"

The hazy picture I get is that you are a hustler and surrounded yourself with (as you say) risk averse employees. You made one of those employees a "co-founder" to lock him in? But he doesn't have your hustle mindset. Maybe never will. The simple, but not easy, option is to take back the shares and let him go. Trying to harangue him to stay is only going to make things even messier down the track. So the right thing by your investors and employees - keep running the business. Perhaps one of the remaining employees could step up to be the team leader - but only as an employee. By definition a co-founder should be on equal terms with the other co-founder. As co-founders you share the product/service vision and have compatible attitudes to risk, finances, etc. You just cannot promote an employee to co-founder.