Ask HN: What's the difference between a cofounder and an employee? | Hacker News Reader

Ask HN: What's the difference between a cofounder and an employee?

9 pointselaineo8 comments

I'm more specifically referring to Asseta's post (https://news.ycombinator.com/item?id=7468549), which is seeking a technical cofounder even though they have already raised a seed round, validated the idea, and built a team of 6.

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It's completely arbitrary. But giving the title of cofounder might make them feel more invested in the company. It'll be their "baby" as well.

Second on: completely arbitrary.

If someone shows up in early days before a company has product market fit and is one of the people that truly shapes the business, call them whatever you want.

I thought it was an odd choice of word too. They are looking for a CTO and they are willing to give a lot of equity, because they are still early stage. But I wouldn't call my self co-founder in that role.

Most employee's don't get to set benchmarks , nor do they get >5% equity in a already profitable startup.

My distinction: you're a cofounder if you worked at any point in time for nothing but equity.

I like that distinction. Elon Musk is commonly thought of as a founder of Tesla, but he didn't actually join the team until he led their Series A round and became part of the board of directors.

Ref: http://www.quora.com/Tesla-Motors-2/How-did-Elon-Musk-build-...

Good distinction. The equity stake of a "co-founder" should be >10% range in typical cases. Working for sweat equity of a couple points doesn't strike me as having influence. On the flipside, owning 10-20% of the company makes you more influential (assuming you're also in an operating role), even if you are not there at the start.Reasonable things to consider, IMHO.

I think this is the best description, but with a qualification. No mater when you joined the company, if you took no salary and got 'significant' equity, then you could be called a co-founder, especially you helped the company get off the ground or make a significant pivot - like Elon Musk for Tesla.

I know folks who are on Founder Board of Advisors. They work/provide guidance for sub-1% equity and no salary. They would never be called 'co-founders'

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