

Ask HN: Co-Founder split - cuchoperl

Hello.<p>I have been a fan of HN for a while and this is my first post.<p>I am the only founder of my startup and I have been working on it in my spare time (20-30h / week) since May. I work full time in an angel investor network.<p>I decided to invite a co-founder because:<p>1. It's has been very lonely so far. I need somebody to share ideas, brainstorm, cry/laugh together, cheer when things go wrong, etc.<p>2. I am lacking some skills that I need to run the company. For example, I do a little bit of programming but not enough.<p>3. My time is limited. I would like to keep working in the angel investor network as long as I can (it's fun and I am meeting interesting people), but I look forward to work full time in my startup.<p>I have been working for a couple of months with a freelance developer. He is young, smart and has more skills than programming. We work together well and I enjoy working with him.<p>He has told me he would like to join the startup. I want to invite him as a co-founder.<p>He is still in the university (finishing mid 2012) and he can work in the startup for 30h/week.<p>What I want to do is this: keep my current job and pay him enough to cover his expenses (25% of my salary) so I can have him for 30h/week. What I will pay him is half of his market (odesk) price. I will work 20h/week.<p>So I will give him a share of the company because I want him to be a co-founder, not an employee.<p>I got the idea and I have spent $5,000 for developing a demo, legal fees, trademark registration etc. I also have spent around 500 hours of work myself.<p>How much of the company should I give him* so he can feel he is a co-founder (not an employee) and taking into account I am the one taking most of the risks.<p>Thanks for your help. Sorry for the poor English.<p>*We will do a vesting of the shares, of course.
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vessenes
My first reaction to this plan is 'this is not a cofounder.' While the deal
you describe might work fine, you're not setting things up for an equal
partnership. I would suggest if you move ahead with this plan, you talk about
and consider the relationship to be 'key technology hire,' and carve out 15%
or so for him, on a short vest, PLUS make up the difference in his market rate
with stock, vesting as he earns it.

Choose a low valuation so that you can be friendly later in life if this is
successful.

I personally believe in reverse-vests for a super early hire like this: give
him the chunk up front, and execute a (pre-agreed-on) clawback if it doesn't
work out in the timeframe you guys agree on.

Anyway, I don't think it sounds like you have the attitude needed about this
person to bring him on as a full co-founder. If you call it that, and it's not
a co-founder situation (as in, you both bring an equal say to the table and
are roughly equivalent in value to the corporation), one of you is going to be
unhappy.

My 2c.

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maxdemarzi
For founders, start-ups are a Binary thing. Either they fail or they succeed.
The difference between a 60/40 or 70/30 split is not that important when the
pie is 0 or when the pie is 20M. It's nothing or it's enough, so don't over
complicate it and just make an offer that makes sense to you.

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kreedskulls
To me it sounds like you are looking to hire an employee who you plan to give
some shares to.

Honestly I wouldn't bring on a co-founder unless the risk was equal. His
payment for now should be the Shares that he will get for being the Co-Founder
until the business starts bringing in Cash.

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cuchoperl
But what do you do when that person needs to pay bills, food, etc? Im will pay
him very little ($400/mo), just enough to live. If he hasn't got money to pay
the bills, he will have to spend time doing consulting work, and that's less
money for the startup. I'm buying his time at the cheapest price possible.

