Help I think I'm getting screwed over | Hacker News Reader

Help I think I'm getting screwed over

6 pointsclamb77713 comments

Ive only got 4% non-delut.

I signed a contract stating that with 4% vesting over a month once we have $100,000 in rev.

then - I show everyone how to built this great hugely money making idea, thinking they will get that there are more on the way.

THEN - I bring up that we should patent our ideas together- so that we can all get credit for the invention.

Partner one gets really pissed. Calls me immature. Tells me I didnt work hard on it. Tells me patents are wasteful. Ends with anger from him, he hangs up. Text partner 2 that partner 1 is pissed, about what we talked about last time; more equal equity now that VCs are gonna get involved. He was sympathetic at the time - now realizing he was just taking my temperature. That was a lie.

Brought up friends lawyer - seeing if they think its a good idea for me to pursue his advice on the behalf of us. Partner 2 (and first boss - EVER) "Ive always liked you Anon, you know that." - What are you saying Partner 2? Dodged around a bit. End of conversation.

VALUE OF BUSINESS: Trgt Mrkt: 6B 3rd yr ann rev. trgt of $21M TAKE HOME MONEY. Yes its scalable. THAT'S JUST IN THE LOCAL MARKET.

I HAVE: the contract. tons of notes about how the whole business works and a complete knowledge of its business processes. societal connections to lawyers - but little money.

What should I do??

Well, do you have any revenue now? The 3rd year revenue target sounds great, but right now my impression is that you hold 4% of nothing or very little. Maybe you are getting edged out over dilution, but are youg etting edged out for 4%? It's not clear. I think you might want to rewrite this in paragraphs instead of bullet points; I appreciate that your two partners seem to cooperating to edge you out after taking possession of your idea, but it's still a bit vague and I can't figure out how well grounded your complaint is.

If you have social connection to lawyers, exercise them - many lawyers will give you a half hour consultation for free, and if you have a decent case that is worth fighting they'll take it on contingency. If you have a decent case that's not worth fighting then they may be able to advise you on how to either protect your interest in the business, or negotiate a buyout of your equity on your behalf. Presumably your erstwhile partners are gambling on the fact that the value of your equity is less than the cost of defending it at present...but again I can't really guess what's going on from this telegraphic description.

Also, take the weekend to evaluate whether you are a) being paranoid, b) overstimating the NPV of tis idea and c) whether you could call their bluff and set up in competition - an obvious breach of contract, but if you get to market first, something that can be written off as a business cost. If you are getting shafted, then playing hardball is a perfectly valid strategy, ethically speaking.

Not a lawyer, and again this is very handwavey because your description leaves so much to the imagination.

Thanks for the useful advice - sorry for my writing - I was a little rattled.

After all- this is my first business deal - ever. And it was with my first boss - ever.

After sleeping on it - I am defiantly getting screwed. I'm really not being aggressive on my B estimate. I think c is the only option.

The current plan of attack - 1- talk to the best lawyer I can find / afford 2- pull together all relevant business information and arrange it in a way others can understand 3- find a bigger fish 4- crush them

Do 2 first, then 1. A lawyer will help you a lot more and cost you a lot less if you are organized. Also, balance the value of what you're owed against the stress of extricating yourself from this bad deal; conflict is very exciting, but not always in a healthy way, and it's easy to fall victim to a sunk cost fallacy, where you end up putting good money/energy after bad because you get fixated on the value of the loss.

I am defiantly getting screwed

I hope this isn't a Freudian slip ;)

Good luck whichever course of action you pursue.

You are apparently incapable of expressing yourself with anything resembling proper English and spelling; perhaps this is the core of your problem?

Our legal system is biased toward those who can persuasively argue their case. If you can't do that, then you need to hire someone who can (e.g., a lawyer) instead of asking strangers on a public website.

Must agree. OP's post barely resembles coherent thought. In most cases like this, people don't tell both sides of the story. If you can't even tell your side effectively, it doesn't bode well.

This is vague and incoherent.

Your comment at the bottom is also vague and incoherent.

If this communication is truly reflective of your thought process and your communication with your partners, then you have some serious misconceptions about how startups work, and serious misconceptions about your partners.

Exactly my take as well. Maybe OP has a valid point but I struggled to find it.

So, you already have 4% of a startup and aggressively scheduled stock options for another 4%, which seems a rather large slice of the pie, and you want a lot of money from your partners (in the form of a large share of some important patent and/or even more equity) simply because you had a valuable idea? Can you explain what sort of agreement gives you such expectations?

Barring outrageously generous clauses in your contract, it doesn't sound like you are being "screwed over": having valuable ideas is your job, and you simply have so little power that the other partners don't think they need to transfer money from their pockets to your pockets to make you happy.

The standard response is quitting, leaving the other partners alone with their greed; if you are as valuable and irreplaceable as you say, the vaguest hint of jumping ship should be a good starting point to negotiate a far better compensation.

If you can't quit, for example because you invested your own money in the company and therefore you really want it to be successful, you just have to be nice. They might be pulling less than their weight, but they are your senior partners and you should be on the company's side, exactly like them.

Thank you for all of your replies.

A significant portion of the business lies directly in my control. Mainly the mathematical model which I brought to them to show the proof of concept.

It will be interesting to see what the legal council has to say.

I'm not sure that your idea is worth very much. Perhaps they excluded you because you just come up with ideas instead of doing work. I'm not trying to be an ass, I just see a lot of this.

This unfortunately sounds like a pitch to the people of Hacker News: I have a multi-billion dollar guaranteed money making scheme, I just need your money to make it happen.

It's not - I just don't know what to do.

I guess the first move is lawyer up.

I can't figure out what you're "lawyering up" over. It's impossible to follow what you've written, but you haven't described anyone breaking any laws.

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