Ask HN: Frustrated with my co-founder. Any advice?
I wanted to share the situation that I currently am with my co-founder and ask for some advice, and maybe even get it from people who've been in similar situations.
In the beginning, him and I were co-workers (both web developers) and really good friends. One day we decided to start some project together, and shortly after that he proposed we do something he'd been wanting to do for a long time. After quickly evaluating the feasibility of the idea and the current competition in the market, I agreed we should do that instead. I wasn't part of the target market for it, but he was, and knew plenty of people who were, too. After a few months of struggling to make decent progress on our free time, I decided I was gonna start working part time, and spending the other half of the day on the startup. I had a lower cost of living and I could do it, and I've always been more risk averse. He needed his full salary and couldn't do it, but appreciated my gesture. He asked me if I wanted more equity for it (the deal was 50/50), and I said 'no'. I know. BIG, rookie mistake. I thought we'd be making a living out of it in a few months, and didn't mind working a bit more and earning less for that long.
Well, after six months of me working part time (during which, his job was basically to give his opinion on look&feel, features, etc), we launched, and since then he also took responsability for system administration tasks, since he knows about that and I don't. Our startup has quite a lot of traffic, so its sysadmin necessities are a bit high, but definitely not even a part time job. I'd say now, two years after launch with +20M pageviews a month, it's about 5 hours a week on average. Some weeks a lot more, others nothing at all.
Two monhs after launch, I decided to quit my job and work full time on the startup. I had a side passive income business that gave me enough to live by, and to be honest I was only excited to work on this, and not my job anymore. It took us an extra year from this point to make any revenue for the business, so for another year I was working full time, while he did the occasional (but important, none the less) sysadmin tasks. Also, he'd convince his friends, who were target market, to become users. It's true, we wouldn't have been able to grow our user base without his connections (or it would have been a lot more difficult), but it's not like he had to convince each one by one or anything. Our users are already using competition services, so it's a matter of knowing them (check) and sending invitations with some custom message on his behalf. From there, it grew pretty much on its own. He also dealt with a friend of his who's a jackass, but a partner who brought an important number of users in the beginning.
So one year after we launch, we start getting revenue. In 2-3 months, it's the same that he's making at his day job (which is a good salary), and increasing every month. 3-4 months after that, it's already 30-50% more than he makes. And here we are, about 10 months after starting being profitable, and he's still raking in his average 5 hours a week on sysadmin stuff, still no word on when (if ever!) he's gonna quit his job to work full time on the startup. To be honest, I am very disappointed in his behavior and commitment, and I don't think he deserves the 50% share of the company he has. Not to mention the fact that he's just a reactive person (something breaks? we fix it. customers complain? we address it.), but nothing really "creative" comes out of him: let's do this, even if noone asks for it; let's try improving this metric; let's aim for higher revenue; etc. Long story short: for the last year and a half, I've been the one who's been running the business, while he's the sysadmin guy who for some reason, I have to check with first before doing anything major, and who also takes 50% of profits.
For a while I tried to just think of him as some early investor that was lucky to get into the deal, but it's just there in my head all the time. The unfairness of it all, and it's really affecting my ability to focus on the business. I'm constantly thinking of new ideas and projects (even spending time on some of them), even when I know there are just a shot, and I already have a great, profitable business in my hands. Only because I wouldn't have him in those businesses.
I'm sure most of you will be thinking of "well, just talk to him and ask for more equity!" The thing is, we've had difficult conversations before, and they didn't go well. For example, in the beginning we said (yes, nothing on paper or concrete, again, rookie mistake) that I'd get some compensation for my extra time spent (part time, then full time) on the startup once we were profitable. Once that time came, the conversation was more like "well, nobody told you to do it, you did it because you wanted to!", so the compensation he thought was fair was ridiculous to me (like a two month salary, for a year full time and half a year part time).
Also, I'm sure he'd be quite on defensive if I brought this up. "You're trying to take what's mine!". Keep in mind he's the one who's part of the target market, so he feels very emotionally attached to the business, a part of it, after so long. And on top of that, he's in quite a bad personal situation right now, and it's gonna last at least a few months, so even more of a reason to take it badly.
Any advice on what to do? Has anyone been here before?
P.S. I'm using a throwaway account because I don't want this whole drama to be traceable to my startup, sorry.
EDIT: I guess I should've answered as well "What would make me happy? What's the ideal outcome?". Well, talking to him and him accepting to lower his equity significantly would be the ideal outcome. 25/75 would be ideal, 40/60 would be OK as well. I guess what I'm afraid is having the conversation, not getting to any agreement but instead worsening the situation with him. We went to such a phase before, and it wasn't pretty (and I was totally unproductive).