(this post is a feed post from my comments on reddit)
r/Entrepreneur
google slicing the pie, thats quite a nice model for thinking about how to spit equity.
at the very beginning, you might not even have discussed equity with the cofounder. but the moment you do, then what you need to consider is an amount, a cliff and a vesting schedule.
figuring out the amount is challenging and subjective, and the area that you’ll likely get into argument.
cliff basically mean the point after which vesting starts, you could set this to a specific point in time or to a specific event, like investment.
the vesting schedule is usually a % over subsequent period, with those periods set to a specific point in time or to a specific event, like investment.
in addition to this, you would also want to include more details on what conditions under which vesting is permitted and related to protect the company, e.g. you might say that its vesting 25%/year for 4 years, on the condition that each year the cofounders targets are met, if they aren’t then the vesting is proportional the the % of the target met.
finally, this is separate from conversation around salary, but salary should take into account the value of equity, in broad strokes, above a basic salary, equity and compensation package are inversely correlated.
What is the standard co founder keeps working agreement? Or ceo?
byu/ExactCollege3 inEntrepreneur