Ask HN: "Founder" Status | Hacker News Reader

Ask HN: "Founder" Status

5 pointshiesenburg5 comments

I recently started a pretty popular outdoors website. I let a friend of mine invest a considerable amount of money into the site's development. He also helps to manage the site on a day-to day basis. We've worked out an equity split and we have clearly defined roles, but we haven't discussed titles. He puts about as many hours into it as I do. We worked on a project similar to the current one about two years ago. This new site is a pretty big variation of the old one, and it's rightfully my idea.

Are there any downsides to giving him "founder" status? Am I being egotistical by not calling him a founder?

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Based on what it sounds like, there would be no monetary implications, no VCs to impress, no legal considerations, right? This may sound callous, but there is really no reason why you should waste time even thinking about titles when you are a two-person shop operating a bunch of websites. Just let it go.

On the other hand, if you already started to divide your stuff into "his idea" and "my idea", this might be an early warning sign that something is in the process of going wrong, if you previously worked together as a seamless team.

If equity issues have been resolved, just give him the 'founder' status and hope he takes it - I mean really takes the site as his baby as opposed to just the title. You want as many people as possible rooting for your success and if a title is all that you need to do it to make it happen then I think you should totally do it.

It can be a tricky situation when there is not a distinction between investors (those writing the checks) and the operating team (those spending the money). There are different incentives and motivations for the two sides and it has a tendency to create power dynamics that are not always best for the business. The fact that you worked together previously and presumably had a positive experience, is a good sign.

Based on your description, I would make the observation that titles are not the biggest potential issue here, but who is making the decisions that drive the business forward. If the investor/cofounder is trustworthy and has the success of the business as the key motivator, then you could be ok.

The other issue is that investors and operators get two different classes of stock: investors get preferred shares and employees/team get common stock. This is another potential issue.

I would suggest talking to him and getting clear on what is best for the business and what he wants out of this: an investment or a job.

Don't go overboard with titles - its bad for expectation management.

The important questions is what his relationship to the business actually is. If he's going to be an equal partner go ahead and call him a founder. If he's more like Employee #1, don't.

Unsure, and somewhat.

You had a good idea and I guess technical skills, he has good judgement and business skills.

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