Ask HN: How to leave my startup after my stock vested?

[throwaway2687]

I'm leaving because of personal reasons, I still believe in the future of the company and would like to make my exit tidy. After 4 years, the vesting schedule is over, and I own approx 40% of the company. I only have 1 other cofounder and some investors. What do you recommended to do in this situation? How should we structure my transition out to ensure the company keeps running smoothly (decision-making, compensation, incentives)?

[e1g]

The business has reached its peak. The remaining person will find it psychologically impossible to create new value working solo, with the knowledge that 40% of it will be taxed by the ex business partner. No investor will put new money into an enterprise where 40% of the cap table is not involved. You are not splitting future growth, you are now dividing present assets as this won’t be a going concern much longer.

Your options are either reduce your stake to keep the business viable for remaining parties, or sell it completely for a fair price. To uncover the hidden fair price, one person decides the share price, and the second decides if they will sell their stake or buy out the first.

[source99 → e1g]

This is pretty spot on. I was on the receiving end of this and it’s incredibly challenging mentally to work hard to give away 40% to someone that just split. The comment about not being able to raise money is accurate as well.

Sell your stake for a fair value and wish the new owner luck. You could keep a few percent of stock but not enough to deter potential investors.

[ghoji → source99]

It what sense is this "given away", not "earned"?

[Kazooie_Bird]

You should probably consult with an attorney

[throw03172019 → Kazooie_Bird]

Probably because an attorney (in this situation) wouldn’t help “ensure the company keeps running smoothly (decision-making, compensation, incentives)”.

[Kazooie_Bird → Kazooie_Bird]

I was down voted for offering surefire advice.. Nice..