I'd like to read about first-hand experiences founding startups with equal or unequal equity splits.30+ year old company, started with equal split (5 ways, 1 founder bought out early).
We are not hugely successful, though I have a nice house in a nice & expensive city because of it. It is my belief the company would not exist if the CEO had gotten control early on. The equal equity was a check & balance on his power. However, there are really two possibilities:
1. The check on his power prevented us from being wildly successful because there was too much consensus needed for risky, but potentially rewarding, decisions.
2. The check on his power prevented him from screwing over everyone else.
On #2. About 7 years after starting, my CEO intimated to me that he made a huge mistake with the initial equity split, and when I asked why, he said he would be cash cowing the business for his own personal gain and he would be much wealthier. Now, he didn't phrase it just like that, but that's what he meant.
The truth is, once you have control of the shares, you can do anything to anyone.
I won't give the name (let's call him Mr. X), but an early investor in the company was serially successful at startups and making a lot of money. Two related facts about him:
* One of X's co-founders once told our CEO that he made almost nothing from the startup that X had made many millions from. His initial stock had been diluted to nothing, because X controlled the majority of shares and the board.
* In the 90s the SEC went after X for dubious sales practices (selling hardware and buying it back under the table to inflate company value... yes, they were public). He paid a large fine and agreed not to be an officer of a corporation for 10 years, but he died before that expired.
After these two events, I started to look at successful people in an entirely different light. Nothing I've learned in the 20 years since has changed the view that 99.9% of successful people, aside from being smart and hard working, are either in the right place at the right time or use ethically dubious methods to get ahead. There are exceptions, but they are exceedingly rare.
Sorry for the rant.