

Some advice on trading equity for help - thesidand

Hi, First a disclaimer, there&#x27;s just 2 of us and we made a few apps in our spare time alongside our regular jobs. We are not focussing on setting up a company around these apps or anything right now.<p>The latest one we made has actually turned out to be a pretty good looking and fun app. It&#x27;s a messaging app where you quickly make a gif (animated loop) and send to a friend. The interface is ridiculously easy and UI turned out pretty nicely.<p>I have this idea that I wouldn&#x27;t mind floating. give away equity in whatever the app is worth eventually to the person (marketeer) who can get the app to a million downloads(or some number). The way I see it, our strong point is design and dev. And an app that&#x27;s worth nothing is, well... nothing. And if someone gets us a little bit more than what we have... then hooray.<p>Is this a bad way to approach promoting a product? Any thoughts would be appreciated.
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nostrademons
Be very, very careful doing this. The biggest problem is that many investors
see it as a red flag if a person who is not involved with the day-to-day
running of the startup holds significant equity. Equity seems cheap when the
company is worth nothing, but it will be near and dear when you are seeking
investment, when you have dozens of employees who would go to Google if it
weren't for their stock options, when you and your cofounder are deep in the
trenches and want to quit, or when you're trying to hire an executive. And if
he holds a significant fraction of voting shares, you may need to consult him
when you do something significant like sell the company or issue new shares,
and if he's no longer involved with the company that can introduce delays when
you can least afford them.

Also, typically marketing a product in the early stages involves making really
significant changes to the product itself. You can't just hand it over the
wall as-is and expect someone to drum up a million downloads. If you lack
marketing experience on the founding team, you may be better off just bringing
on a full cofounder who shares your vision but is comfortable going out there
and talking to customers.

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thesidand
That makes a lot of sense! We put the app out there, and regardless of all the
FB posts and my emails. It hasn't gotten any traction (in terms of downloads).
The ones who do use it, seem to really enjoy it.

So I was thinking that I just needed to get a couple of thousand downloads, to
get more feedback. Thanks for you time!

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opless
One word: Don't.

1\. Never accept equity from a start up, unless you're sure they'll succeed.

2\. Never give away equity as a start up, as you'll probably lose everything
and they could walk off with all the IP.

(Yes, I don't like "investors" \- which makes me wonder why I'm hanging out on
a ycombinator domain)

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sharemywin
Did you do a Show HN. seems like people are usually pretty helpful with advice
around here.

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thesidand
Nope. I have always been a lurker, but I see the link up top now. Will post my
project there! Thanks!

