5 ms·

50% is awfully rich. A better way to structure this is to offer a smaller percentage (less than 10%) which vests on completion of agreed upon milestones (i.e. c

50% is awfully rich. A better way to structure this is to offer a smaller percentage (less than 10%) which vests on completion of agreed upon milestones (i.e. completed angel round, N licensing deals, etc). If the person delivers, and you enjoy working with them, negotiate a longer term agreement with 3-4 year vesting. You may find that he/she delivers, but is a nightmare to work with, so its important to have an out if that's the case. I don't really like the idea of charging them up front. If someone is as good as they say they are, and are working full-time, their opportunity cost for salary is $10,000 to $20,000 per month. My personal experience is that people tend to greatly exaggerate their ability and connections, so its important to have clearly defined deliverables/milestones, and a solid legal contract that covers less than ideal outcomes.

apapli 14y ago
Agree. Your math doesn't quite work here but your thought process is good. The opportunity cost of taking 3 months off work full time is significant - 30-60k per the number above is reasonable and I'd suggest is on the low end if the hustler is any good at what they do. To give a co founder whom I have never worked with $5k and 50% share in the company for only an MVP is not really compelling - I could go to Elance and spend $5k for something pretty reasonable, and retain 100%. Perhaps restructure your proposition, because your idea still definitely has merit. How about becoming a technology advisor for hustlers - help them translate their vision to a brief that can then be outsourced to elance (etc), then manage the developers for the hustler. I doubt you'd get 50% share in the product but you would get listed as an advisor with a minor share, some good $$$ for your time, combined they might have sufficient appeal.

apapli 14y ago

Agree. Your math doesn't quite work here but your thought process is good. The opportunity cost of taking 3 months off work full time is significant - 30-60k per the number above is reasonable and I'd suggest is on the low end if the hustler is any good at what they do. To give a co founder whom I have never worked with $5k and 50% share in the company for only an MVP is not really compelling - I could go to Elance and spend $5k for something pretty reasonable, and retain 100%. Perhaps restructure your proposition, because your idea still definitely has merit. How about becoming a technology advisor for hustlers - help them translate their vision to a brief that can then be outsourced to elance (etc), then manage the developers for the hustler. I doubt you'd get 50% share in the product but you would get listed as an advisor with a minor share, some good $$$ for your time, combined they might have sufficient appeal.