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Sign away IP. You have a NextJS app. It's not worth anything there. But you did build the MVP for free (I'm assuming you didn't bill him) which is worth somethi
by missedthecue 2y ago
Sign away IP. You have a NextJS app. It's not worth anything there. But you did build the MVP for free (I'm assuming you didn't bill him) which is worth something.
Given that you won't be doing anything else after August. Ask for 10-20% instantly vested, or a combination of instant and scheduled. And, he has the right to buy you out in X amount of time at Y valuation i.e. 3x TTM sales.
So if the business were at $1 million sales in 2 years, he/his investors have the option to buy out your 10% for $300k. For example.
Don't do profit sharing on a pre-rev company. Pulling money out of small software company that's just getting started hurts both your interests.
- equityconvohelp 2y agoStock buybacks sound like they could be a fair way to structure this deal. What if the company never goes public/gets bought? How do I ensure that I get something out of this if the business becomes very profitable? Thank you for your comment.
- rashidae 2y agoBy choosing the secure path of a $120k/year salary, you are taking on a certain level of risk. However, if you want to protect your future potential, you could retain 20% of the equity and allow for a 80% buyback option.