2 ms·
One thing no one told me: When you cofound a company, its not the equity percent, but who is in control that matters. If you have 40%, and they get 60%, but le
by ldjkfkdsjnv 1y ago
One thing no one told me:
When you cofound a company, its not the equity percent, but who is in control that matters. If you have 40%, and they get 60%, but legally or otherwise (you are the face of the company), then you have control and the 40% is worth more than the 60.
If you leave early after cofounding a company, there is no saying what happens to you shares, and likely they will be diluted to almost nothing
Its all about control.
If you are an employee, either go for a company thats a few years from IPO, a generational startup, or consider the equity worth 0.
- leonhard 1y agowhat’s a generational startup?
- ldjkfkdsjnv 1y agocursor
- ipaddr 1y agoThings are moving fast. Not sure how solid they will be next year. Bigger players want that marketspace.
- shishy 1y agoThey probably meant a "once in a generation" startup like a unicorn
- sdfasdfas134 1y agoThis is true. Once you lose control, the VCs will start to appoint their buddies in Atherton in as CEOs, VPs, SVPs, Chiefs of Staff, etc. Eventually you get pushed out. You wont even know what half the people do. Or you get impossible performance plans placed on you (that their buddies wont get) which will mean you either achieve the impossible or you lose your founder stock. If you are giving up voting control, ensure to get a secondary sale to sell some of your stock (5-10mil) so you're set for life. Then you can let the VCs burn the company down...if you really want.