

Ask HN: Help us figure out cofounder equity split. - deepbluewater

Dear HN,
We'd really appreciate your input on how we should go about splitting the equity among our three founder team.<p>Project: Social Game Startup<p>Dilemma: Equity Split<p>Team:
Eddie: Eddie worked at two of the major gaming companies for 1.5 years. He also co-founded a gaming studio that saw a modest exit (&#60;50k) before his MBA. He has been working on this idea throughout his time in business school and is now graduating. He has a design document with mockups.<p>Eddie will be working on this startup full-time. He is in charge of business and game design.<p>Mark: Mark has been a software engineer for five years, at major companies and startups.<p>Mark has a 20 hrs/week part-time job at a software firm. The remaining time will be dedicated to the startup. 
Mark will be writing the software and building the UI.<p>Fred: Fred has been a software engineer for four years at major companies.
Fred has a full-time job at a software firm, and will spend the remaining time at the startup. 
He will be writing the software with Mark, as well as any future native mobile apps.<p>Mark and Fred cofounded a startup and ran it for two years (lets call it Flippr) in the social space. Flippr did not gain significant traction, so they decided to join forces with Eddie. Code from Flippr is projected to be 35% of the new project. Mark and Fred built a prototype of the new project in a couple of weeks, based on Eddies design document.<p>Other Notes:
- Everyone will be working for sweat equity. No funding yet.
- The team gets along and would like to work together.
- Company expenses are split equally among the team.<p>Given the circumstances mentioned above, what equity split is fair? And why?
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DanBlake
50/25/25 - You want to keep them motivated and part of that is feeling like
they still have control, ie 50% of the company when teamed up.

Startups are all about whos working on it now, not who may leave their job
later to go full time. Those types of people are not cofounders, they are
future employees.

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portman
I'm can't propose an equity split, but given those facts I think Eddie
deserves more than Mark who deserves more than Fred.

This will be a full time job for Eddie, a part time job for Mark, and a side
project for Fred. (Yes, I'm sure Fred will work 100 hour weeks and that his
day job is easy, but the mental tax of holding two jobs cannot be overstated.)

But I wouldn't divvy up 100% right now. I would keep some equity unallocated
so that if Mark or Fred decide to work for the startup full-time, their equity
can be adjusted to reflect that.

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AmberShah
30/30/30

Everyone is experienced and valuable AND is bringing something extra to the
table (design mockups or an existing codebase). The only thing of remote value
at this point is the prototype which was built by all 3 people (both coders
using the design).

Just add a 4 year vesting with 1 year cliff, so if Mark wants to take a hike
in 6 months, it goes back to 50/50 between Eddit and Fred (or whatever).

