I had something like this happen to me (on a larger scale) - I folded, and regretted it for years. Firstly - go straight to see a lawyer. Do not consider anyth

I had something like this happen to me (on a larger scale) - I folded, and regretted it for years. Firstly - go straight to see a lawyer. Do not consider anything else before you have done this. Play hard, don't blink! Secondly. If things don't go your way, play the long game and take your time. Make sure that they know that this will not be resolved quickly, and that having this hanging over them will frustrate their attempts to raise capital. Behind the scenes this is what I think is going on: 1) The CTO is more experienced, and thinks he is entitled to more than you as a result (you seem to agree that you are relatively inexperienced). He cares little about loyalty and honour as he was not there to see you slogging it out in the early days. 2) What you have set up must be worthwhile and be starting to get valuable, otherwise you would not have attracted a "good" CTO. 3) My thoughts are this is part of the play to attract equity: - They probably don't want to dilute too much, so would love to grab your shares back before the deal so that they can neaten things out for the new investor - They probably want the new deal to include shares for the CTO. He is probably niggling for this, and the CEO would prefer to take yours than dilute his. - They want to put forward a team that has the most value for fund raising. They want solid credentials, and probably feel that yours don't fit the bill. Good luck hey!