I'm a solo non-technical Founder who's bootstrapped his way to a successful MVP with a part-time equity-compensated developer. I've now finally found a FT technical co-founder who is a much better fit to take us to the next level, but he understandably wants at least 20-25%. My currently part-time developer (who I can't afford to completely lose) only has 10% and is now offering to go full-time for increased equity. How do I communicate to my existing lead developer and other equity-compensated employees that someone younger, joining at a later stage, deserves 2-3X more equity than them without having them quit on the spot?
That is a touchy situation but you need to make hard decisions when involved in a startup. I am assuming the new Technical co-founder has more experience than the original team member. If that assumption is true, I would sit him/her down and say, as you know 25% of a small company is not much, but 5% of a huge company is significant. If we can attract this new CTO, I believe we can take this to the next level. I need you of all people to be onboard with this and be my eyes and ears when it comes to the engineering team.
Answered 9 years ago
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