4 ms·

Sorry to hear that you didn't get the stock. I've been in a similar scenario where promises of stock were made and later not kept by a very small startup. In

by cmccabe 13y ago

Sorry to hear that you didn't get the stock. I've been in a similar scenario where promises of stock were made and later not kept by a very small startup. In my case, the company didn't end up going anywhere, so there was not much regret on my part at the end. I also did get a salary during that time, which helped. Joining as a low-numbered employee is a really big act of trust, bigger in some ways than being a founder. You ought to find out everything you can about whom you'll be working with, and what they think of you, before you consider it. It helps to have the ability to read people. Getting things in writing definitely is a must-do, but it's not a silver bullet.

logicallee 13y ago
regarding, >"Joining as a low-numbered employee is a really big act of trust, bigger in some ways than being a founder. The reason it's not a "bigger in some ways than being a founder" is precisely because you CAN follow the suggestions you then list >You ought to find out everything you can about whom you'll be working with, and what they think of you, before you consider it. Getting things in writing definitely is a must-do, but it's not a silver bullet. There is simply NO way to do that as a cofounder! The paperwork SIMPLY DOESNT EXIST. As an early employee, you can view our patents, trademarks, etch stack, talk with other employees, see our level of funding. As a cofounder, you get to see an idea. There is no guarantee whatsoever of ANYTHING as a cofounder, EVEN if you get it in writing. The only thing you can be guaranteed is 50% of nothing. So in some ways you could say that joining as a low-numbered employee is for people who want to make it rich but don't have the balls not take any salary, not to have any paperwork, anything in place whatsoever that they can do due dilligence on except the person of the their cofounder and the ideas and work that they personally bring to the table with their own two hands.
- sjs382 13y ago
  The parent is talking about trust. You're talking about risk.
  - logicallee 13y ago
    I just don't see that. Where's the trust - as an early employee you have an employment contract that will be enforced by law, you get cash coming in every two weeks or monthly that is also enforced by law, and your employer owes you a bunch of other rights. as a cofounder, you're not owed shit. (except 50% of nothing). the same thing applies to options contracts or anything else. What I mean is as an early employee you can SEE all this in writing. As a cofounder, you also get to have your equity agreement on paper. If it's 50% it even means something. As a minority cofounder (e.g. if you're the 10% guy with the other two having 45-45) that would mean considerably less. I just don't see how you can anywhere NEAR approach the level of trust as an early employee, that you need as a cofounder. It's not even within three orders of magnitude of each other. And that's part of why there are so many fewer cofounders than employees in the world. I mean think about it!! What can I say over IRC and Skype that would convince you to be my cofounder without meeeting? What kind of paperwork can I produce? What kind of documentation? Now compare that with being a remote early employee. The level of trust required is literally 3 orders of magnitude less. Not risk: trust. But risk too.
    - cmccabe 13y ago
      Have you actually been an early employee, or are you just speculating? I can tell you that in a lot of cases the paperwork you love so much often simply doesn't exist. Even if it did, it might not be worth the paper it was written on. There are a lot of ways to lose out. If you're not a lawyer, there is almost certainly something in the contract you overlooked. The contract might not even be valid if two non-lawyers came up with it after a few beers. You could be fired right before your options vest. (This happened to a lot of people at Skype, for example.) Or you could be diluted down to nothing after a few rounds of financing. Sure, you can sue, but is that really going to help? If the company goes out of business you're trying to get blood from a stone. If the company succeeds, they'll have a legal budget 1000x yours. Ultimately, the founders are going to set the direction of the company. You have to trust them, and also trust that you will be useful to them over the long term. Any other strategy is just a losing bet.
      - 13y ago

by cmccabe 13y ago

logicallee 13y ago

regarding, >"Joining as a low-numbered employee is a really big act of trust, bigger in some ways than being a founder. The reason it's not a "bigger in some ways than being a founder" is precisely because you CAN follow the suggestions you then list >You ought to find out everything you can about whom you'll be working with, and what they think of you, before you consider it. Getting things in writing definitely is a must-do, but it's not a silver bullet. There is simply NO way to do that as a cofounder! The paperwork SIMPLY DOESNT EXIST. As an early employee, you can view our patents, trademarks, etch stack, talk with other employees, see our level of funding. As a cofounder, you get to see an idea. There is no guarantee whatsoever of ANYTHING as a cofounder, EVEN if you get it in writing. The only thing you can be guaranteed is 50% of nothing. So in some ways you could say that joining as a low-numbered employee is for people who want to make it rich but don't have the balls not take any salary, not to have any paperwork, anything in place whatsoever that they can do due dilligence on except the person of the their cofounder and the ideas and work that they personally bring to the table with their own two hands.

sjs382 13y ago
The parent is talking about trust. You're talking about risk.
- logicallee 13y ago
  I just don't see that. Where's the trust - as an early employee you have an employment contract that will be enforced by law, you get cash coming in every two weeks or monthly that is also enforced by law, and your employer owes you a bunch of other rights. as a cofounder, you're not owed shit. (except 50% of nothing). the same thing applies to options contracts or anything else. What I mean is as an early employee you can SEE all this in writing. As a cofounder, you also get to have your equity agreement on paper. If it's 50% it even means something. As a minority cofounder (e.g. if you're the 10% guy with the other two having 45-45) that would mean considerably less. I just don't see how you can anywhere NEAR approach the level of trust as an early employee, that you need as a cofounder. It's not even within three orders of magnitude of each other. And that's part of why there are so many fewer cofounders than employees in the world. I mean think about it!! What can I say over IRC and Skype that would convince you to be my cofounder without meeeting? What kind of paperwork can I produce? What kind of documentation? Now compare that with being a remote early employee. The level of trust required is literally 3 orders of magnitude less. Not risk: trust. But risk too.
  - cmccabe 13y ago
    Have you actually been an early employee, or are you just speculating? I can tell you that in a lot of cases the paperwork you love so much often simply doesn't exist. Even if it did, it might not be worth the paper it was written on. There are a lot of ways to lose out. If you're not a lawyer, there is almost certainly something in the contract you overlooked. The contract might not even be valid if two non-lawyers came up with it after a few beers. You could be fired right before your options vest. (This happened to a lot of people at Skype, for example.) Or you could be diluted down to nothing after a few rounds of financing. Sure, you can sue, but is that really going to help? If the company goes out of business you're trying to get blood from a stone. If the company succeeds, they'll have a legal budget 1000x yours. Ultimately, the founders are going to set the direction of the company. You have to trust them, and also trust that you will be useful to them over the long term. Any other strategy is just a losing bet.
    - 13y ago