Bad idea. The fact is that he will never work full-time on this startup. Treat it has such. Since he probably doesn't need a salary (he already has a job), just

Bad idea. The fact is that he will never work full-time on this startup. Treat it has such. Since he probably doesn't need a salary (he already has a job), just treat him as an advisor (a few percent of stock), and a huge commission for any sales he brings (30% of profit for his leads). You don't want to have conditional/future equity based on some formula. You'll spend the next year arguing about what the formula should have been, why things that were not planned should be taken into account (or not), etc. Just don't. You can't forecast the future enough to make fair deal.