Ownership for business cofounder | Hacker News Reader

Ownership for business cofounder

6 pointsbeachgeek5 comments

Hello, I wanted to pick people's brains and hopefully this is the right place for it.

I'm primarily a developer/engineer. My designer and I have been working on our project for a while (>2 year) while we've had other jobs. We're both perfectionists so we took our time until the thing was perfect (did user surveys, ran previous versions, did customer surveys, rinse and repeat etc)

I spoke with a couple of investors in the interim, but I got the sense they seemed leery until we could show there were actual people using the darn thing at least. Making products is my forte anyway, so I figured I'd work on it. So now we're a couple of weeks away from letting friends and family use it. It is time again to at least get back on investors' radars but I can only focus on so many things at a time: write code, fix bugs, work on my real job etc.

Meanwhile my previous manager had been asking to become CEO. He's a pretty good salesguy and has been able to get some good meetings etc with investors and prospective customers in the last month or so.

My question is what is the proper ownership ratio to offer the guy?

My advice, unless you have zero runway, don't offer him anything, or ask any favors.

Get the beta rolling, tweak, tighten, fix up, repeat, then go talk to investors whom you have spoken with already, and go from there.

I am not sure if this character fits in well, he wnats to be your boss again.

Perfectionist = foolish because you don't determine what perfect is, your customer does. So let your customers play with it and get feedback.

There is always angel list, and local angels. Raising money for something that is growing is much easier. Get the product out.

I'd be concerned at the "former boss" part. Do you want to work for him again? Does he want a nice title and is hoping to piggy back off your work? What does your developer think of this potential new social dynamic in the business?

While you could always figure out equity (this is sounding like a first employee type thing, maybe a bit more because he's C-level), your investors may want him to occupy a board seat. There's you, and your designer currently. That's 2 votes and if you can't decide there's no tie breaker. So besides whatever equity you get your former boss gets to determine significantly the direction of your business. Can you handle that, with you and your designer being self proclaimed perfectionists? While obviously you have to trust anyone you bring in, can you trust him specifically? I'm betting you can always find a good sales guy if the answer is no.

EDIT: A final question you might have to ask yourself is: could you fire him as the CEO if he wasn't what your business needed to grow?

Whatever it is, make sure there's vesting. Don't just hand him 10% of the company like that without doing any work.

Thanks all. @abbasmehdi I should have mentioned we've had various iterations of the product already where we got feedback from customers: that's what I meant by being perfectionists, not that we're sitting in a vacuum somewhere all by ourselves :-)

@TuaAmin13: I appreciated getting his feedback and so on because you know how it is: I've been getting great feedback from my beta testers etc, but nothing from adults per se. My last meeting with him though I really did get the sense he was trying to piggyback off my work, where he asked for a ridiculous amount of equity for approximately one month of real "work".

You guys have given me great feedback. I'm going to ignore the guy and just focus on getting the product out.

Smart boy.

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