If he's fantastic and believes in what you're doing, what about bringing equity into the equation?
I ordinarily say, "Contractors don't get equity. End of discussion." But it sounds like money is tight, and you have deadlines to meet and/or goals to achieve that this person can help you achieve--that's what equity is for: The things that you can't get any other way. If you can't afford him, then you can't get it in the normal manner.
The other option: Trade equity to an investor for money--more than it takes to bring this person on board. It's still giving up equity, but it'll probably buy you more in the long run.
Or, keep negotiating. Rates are negotiable until one party gives a plain ol' "No". If he isn't having to juggle jobs to make ends meet, he may be willing and able to work on your project in order to do something fun. When I did contract work, I lowered my rate all the way down to 1/3 the normal rate to work on stuff I really liked. And when I could no longer give them my full attention at those rates, I left the job and helped them in the process of hiring a replacement.
Agreeing with one of the options above - one of my friends who works with a lot of startups will take a lower hourly rate in exchange for equity, depending on the startup. I think the deal is he gets 1% of equity for X amount of hours worked, with an hourly rate a chunk lower than he normally works at. He seems happy with the deal and the client's happy with his work.
As a freelancer, I've been asked to work just for equity on various projects. Normally this is by people who have a poor business idea and often no real clue about how to implement their side (i.e. the business and marketing) side of the idea. So if you ask a freelancer about working for equity, even if it's a split deal with some money, please understand that you're going to need to sell them the idea just as you would any other investor. iamdave it sounds like you're not in this exact situation as you all ready know the guy.
I ordinarily say, "Contractors don't get equity. End of discussion." But it sounds like money is tight, and you have deadlines to meet and/or goals to achieve that this person can help you achieve--that's what equity is for: The things that you can't get any other way. If you can't afford him, then you can't get it in the normal manner.
The other option: Trade equity to an investor for money--more than it takes to bring this person on board. It's still giving up equity, but it'll probably buy you more in the long run.
Or, keep negotiating. Rates are negotiable until one party gives a plain ol' "No". If he isn't having to juggle jobs to make ends meet, he may be willing and able to work on your project in order to do something fun. When I did contract work, I lowered my rate all the way down to 1/3 the normal rate to work on stuff I really liked. And when I could no longer give them my full attention at those rates, I left the job and helped them in the process of hiring a replacement.