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If we take this article down the "slippery slope" it proposes, you'd end up with 8 people in the company owning ~80% of the total equity, with the "founder" onl
by mjmahone17 13y ago
If we take this article down the "slippery slope" it proposes, you'd end up with 8 people in the company owning ~80% of the total equity, with the "founder" only owning ~15-20%. But why this is a negative thing for the company is still up in the air: at that point, you might as well have a partnership, like consultancies, law firms or advertising agencies. There's no inherent reason a partnership couldn't make the next LinkedIn or Oculus Rift.
- tptacek 13y agoThat's about where founders land now, isn't it?
- mjmahone17 13y agoYes, but it seems like with much less say than they would have if they were a partner, as opposed to just 15% shareholders.
- busterarm 13y agoThat would be a terrible turn of events though; law parternships have had to grow significantly (in number of partners) to survive. having a partner that wants to retire or leave often risks dissolution of the entire partnership. You end up having to bring in more and more partners just so people can leave without sinking the whole ship. This industry moves _way too fast_ for partnerships to really work and convert business equity into cash at the same time.