Ask HN: My cofounder is pregnant, what should I do?

Male. Parent. First kid born during a startup I founded. My spouse works with me in my current startup, reads and occasionally posts here, and will smack me down publicly if I'm wrong about this.

(1) A full year isn't "maternity leave". Companies are (reasonably) expected to work around maternity leave, but professional moms routinely come back to work a few months after giving birth. Staying at home with a baby for a year is totally reasonable, but casting that as "maternity leave" is less reasonable.

(2) But please note that there may be benefits-related reasons to maintain employment status or calling a stretch of time "maternity leave". The next 9-12 months are going to be health-insurance-intensive. COBRA is very expensive and suboptimal for other reasons too.

(3) If neither of you have left your day jobs, neither of you have started the company yet, and this is all a moot point.

(4) All else equal, the primary thing you're valuing with founder equity is risk taken. Outside of exceptional circumstances, you shouldn't be giving equal allocations to people who aren't full-time at the company. But re-read point (2) and don't look for reasons to call someone "not full time" when they are effectively full time. There are also knobs you can turn here; for instance, if cash flow is the biggest problem in the first year of the company, and your cofounder is still pulling in a salary, maybe she can kick some back to the company to retain status. Or maybe you can keep the allocations simple but start the vesting clock for her later than yours.

(5) Remember that your startup idea, as excited as you may be about it, is going to fail. Virtually all of them do. There is an overwhelming survivorship bias in the stories we read online about startups. You will have 100 better ideas for startups over the next couple years. You will not find 100 ultra-compatible cofounders. So another knob you can turn: keep this current idea small and side-project-y, don't go out of your way to grow it, wait out the new parenthood stuff, and then pick something else up next year.

Great points. I would also suggest:

Ask her what her thoughts are without giving any indication that you have reached any conclusions in your own mind already. Just pull information out of her and not push any over into her during this chat. Maybe she will offer something that will work without you pushing for anything.

That's great advice, thanks.

#5 is a very good point (although, I'm convinced that we won't fail). You're right, in that, these relationships are very hard to find.

Everybody is convinced that they won't fail. You should absolutely be planning as if you will; being able to do that may be one of the differences between people who succeed in startups and those who fail, since most of the failures never get up and try again.

You need to have a frank discussion with your co-founder ASAP. Is the plan really for her to do no work at all for a full year? I don't see how that's possible as a startup co-founder. For instance, how will you pay your bills?

This is a major risk/threat to your startup and you need to plan carefully on how to managed it if you plan to be around by this time next year.

Also: http://www.quora.com/Pregnancy-and-Work/Is-it-wrong-to-fire-...

Thanks for the link. And yes, this will be her first child so she is planning to take the year off (she'll be on maternity leave from her "real" job). She the kind of person that would probably squeeze in extra time for our project when ever should could, but I don't know if I want to put that stress on her.

I think a fair way to treat it may be to set up a schedule for your equity to be vested, if you did not do that already.

Say, typically your equity may be vested over 5 years. If she had put in a year so far then 20% of her equity has vested. The rest will start accruing once she re-joins the company.

That would be a fair way to go I think because if she does return then you can continue your partnership.

Great suggestion. How would you take into account the entry of a new partner in year 3, for example? Would that new partner just dilute everyone? Can you suggest any good reading on vesting schedules?

I'm not female nor a parent (yet), but I also believe in a family-first environment. My startup is in the education field, so children and families are at the core of why we're doing what we're doing.

Here's one thought:

What if your cofounder wasn't pregnant, and simply wanted to take a year off? How would that change the way you think everything?

In other words, forget the fact that she's pregnant (or even that your cofounder is female, in case that's swaying your opinion), and just think about it as a generic cofounder with complimentary skills that will be departing for a year.

This would raise some thoughts and questions for me:

1. How likely will your cofounder come back in one year?

2. How do you keep going forward alone? (e.g. hire, find more cofounders, etc)

3. How do you compensate her for the IP she's already contributed? (i.e. company equity, consider her work done as a loan to be repaid, etc)

4. If the compensation to her is equity, what is the equity split? My guess is it wouldn't be 50/50, but what is a fair amount that compensates you adequately, yet still provides an incentive for her to return?

5. How will being alone for a year effect your fundraising activities? Most investors invest in teams moreso than ideas. If you are doing this alone for one year, investors will likely view you as a single founder.

It's very likely that you come up with a contingency plan and hire contractors to keep you going for a year, then when your cofounder returns, she returns to her part of the venture.

Or, you part ways amiably, and her compensation is a small equity stake and a role as an advisor or something, while you seek another cofounder to continue.

I wish you the best of luck. Hopefully you both can talk it out and come up with a suitable arrangement for you both.

Very good points, thank for this new perspective. If she were taking a year off for other reasons I would think about it in a very different way. But ultimately, the outcome would be the same.

You're right, we need to have this conversation before we dump more time into this.

You guys have contributed equals parts so far create the company and split it evenly. Don't be greedy, focus on making the pie bigger not getting a bigger piece of the pie. Don't complain because she might benefit from your work along with you.

As a co founder, she should have a commitment to the project and will probably contribute in whatever capacity she can for the time being. If she is as valuable as you claim, she is worth keeping around and will probably return as soon as she can. If you need help with your project, get some.

Very good points. To be honest, I'm not too concerned with ownership. However, I do have a sense of this situation not being fair. The real problem is that I need her help, and I'm going to have a really tough time finding someone who has her passion, skill set and motivation.

Ah, thats probably the most clear cut description of your problem then.

So for argument sake - this could just as well be a male co-founder who has a major personal issue that he needs to take care of, but his skills and presence is needed.

So this is a "see what knobs you can turn" situation. What are your hard limits - do you have to be cranking it now? Can you focus on some other part of the project? can you slow down the pace? Do you have to meet some deadlines? Can their work be done in advance? Basically - What are the knobs you have? Figure that out, and then twist to get the best fit.

As someone pointed out, a good co-founder is hard to find. Also, this is a pretty important time for her too, shes got two things she is strongly invested in, and having to make a choice like this sucks.

Tricky situation!

Here are my observations based on what you described:

The very fact that you're thinking if it would be fair for you to build the business on your own while owning only half the business suggests to me that it's only the incentive of owning more of the business (or rather the lack of such an incentive) that is preventing you from actually doing it on your own. You already know you will be able to do it alone deep inside or so your style of writing suggests.

That said, I would suggest you speak to your co-founder about how the business should grow in her absence. That should get the ball rolling and set the tone for one of you to bring up this topic.

I'm sure your cofounder has thought of this too. At some point did you miss the opportunity to have a discussion about the future of the startup when she leaves for maternity leave? Or is she convinced you can do the majority of the work for a year and the matter is settled in her mind? edit Anyways, you have to have a discussion with her. It's going to hurt less now than later.

She was very nervous she decided to tell me she was pregnant; I told her that I was excited (which was honest) and that we should think about it and discuss it later. Then we developed a plan up until the month of our launch and her pregnancy. And to be honest, we haven't discussed what will happen going forward from there.

You're right, we need to have that conversation sooner rather than later.

Figure out a way to buy her out or whatever needs to be done to get her out of the picture, how can someone take a year off as a startup founder? That doesn't make sense.