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I don't have much for you regarding equity. I'd propose thinking about other ways for you both to find a winning relationship: Is your customer actually making
by tuke 14y ago
I don't have much for you regarding equity. I'd propose thinking about other ways for you both to find a winning relationship:
Is your customer actually making money? One thing you might propose is some kind of profit share based on your contribution. I.e., propose that you take a % of future profits. This would be a great incentive for you to do a great job for them; and the premise is that everyone is making money. By this means, you might avoid some of the agony of trading your own time for something unpredictable.
- lutusp 14y ago> One thing you might propose is some kind of profit share based on your contribution. I.e., propose that you take a % of future profits. For a corporation that issues stock, this is illegal. Do avoid offering this kind of advice. From the OP, we know the company is organized as a corporation and has a board and issues equities. Therefore, as a matter of law, it cannot "share profits" with a specific individual without breaking corporate law.
- eggsalad 14y agoI believe it is currently an LLC, with a bunch of private investors (wealthy individuals, not VCs). I also spoke with a lawyer, and they didn't foresee any issue with profit sharing. Can you be more specific on why you think it might be illegal?
- rdouble 14y agoLLCs cannot issue stock.
- eggsalad 14y agoThis is an excellent point, I've been thinking about setting up a commission structure. Say 5% commission from each product sold. Do you have any thoughts on commission versus equity?