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Ok. This is what i have in mind. Do comment. The min. he will get is 10% and the max is 40%. Starting from 10%, he get an additional 1% for every $1m increase in company valuation during the funding.

So if the valuation is 30m or more, he get 10% + 30% = 40% If valuation is 20m, he get 10% + 20% = 30%

Fair?

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I dont know about actual numbers but here is what I have in mind when I talk to potential cofounders: 1) trial period of min. 3 months

2) vest the other founder's equity. Dont just give him 10%. Make it 10% after one full year - or 0% for any less. How do you know whether he is working on your stuff fulltime?

3) Dont listen to empty promises. If he wants more, make him buy the equity. Say, value your company now at $200K. Then let him give you $100K cash if he wants 50%.

4) Ascertian a value for the work you have already put in.

I may be wrong, but this is my opinion.

Oh. He'll be paying for the equity. So assuming i value my company at 100k now, he'll pay 40k for 40% equity now.

Does he have startup experience? if he has so much confidence to pay cash now, you are lucky!

It sounds like you probably have a killer app. Can you tell us what it is?

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