Equity distribution · Finding cofounders

If you find someone who is interested to become a cofounder in your company, what are the next steps?

Khaldon Evans Cofounder & CEO @Ochy. Looking for a CTO to join our AI sports tech venture

April 6th, 2021

Let's say you when through all the normal interview process and validate their skills is what you need and they seem like a person you would like to work with.

  • Do you just go ahead and get them on board?
  • Do you try them on a test project and see how you work together?
  • Do you wait a couple of months while maintaining discussions with them?

Fred Cohen We help grow companies

April 6th, 2021

A co-founder is not an employee. Your tactics look more like the tactics for hiring a worker. This of a co-founder as a partner in a marriage. You will be living with them for the next 5-10 years, dealing with them every day. IF this is the main thing you intend to do for 5-10 years and the same is true of them, you had better like them and get along with them and have a good level of trust and separation of duties. This is just the start...

Mike Moyer

April 6th, 2021

This is much easier than most people think. If you have a shared interest in the project just start working together. It's literally as simple as that. It would be smart to do a little research and check their Linkedin profile and make sure they are who they say they are but beyond that the proof is in the pudding. Working with them will tell you if you want to work with them.


But wait! You say you can't pay them? Use equity!


But wait! What if you give them equity and they turn out to be unproductive or incompatible with your vision!


No problem. The Slicing Pie model is an equity model used by startup all over the world. It allocates equity based on the actual contributions made by each participant. Additionally, there is recovery logic that allows you to get equity back if the person does not work out. You and your ideas are 100% protected no matter what happens.


Other equity models require you to dole out chunks of equity based on guesses about future events and then do a horrible vesting schedule...ugh. What a pain in the butt!


Working with partners is easy. Here is a great case study about strangers who met each other on Reddit and started a successful startup: https://slicingpie.com/slicing-pie-case-study-cloudsploit/

Gareth James-Ryan A fractional CTO/technical advisor to start-ups and looking for a challenge

April 6th, 2021

Interesting @Mike Moyer, never heard of that method, tended to swing towards a vesting schedule, but will take a look!


@Khaldon Evans, I tend to only work with people I can get on with. If I don't get that positive feeling, I say thanks but no thanks. Even with the current climate, I still ask to meet in person, even if it's just a walk around the park for a coffee and chat. But I agree with @Fred Cohen, that they aren't another employee.

Jimmy Atohengbe Founder & CEO Infinitiv, Inc. & Watchtower, Inc.

Last updated on April 6th, 2021

Not necessarily exactly what you mention as the second item on your list but from what I've learned, it's generally a great idea to work and take note of working with them on business matters during the initial stage, specifically during the one year 'cliff' of their onboarding because if it doesn't work out, this window of time is when they can be "offboarded" without any change in equity, which, in standard terms, vests 100% in four years but after the 'cliff' some of it may vest (or whatever term is agreed).

David M

April 6th, 2021

First I would argue if you had a “normal” interview that is only the first step. And if it was normal in the sense of the non start up world, that may be a hindrance because there is nothing normal about the startup process. If you tested their vision, grit, motivation, passion and ability to deliver…then that works. Gauge their working abilities which 99.9% of interviews simply fail miserably at. Test project or situation can only help you further evaluate. If you find yourself wanting to steal their ideas and claim as your own….good news… they may be smarter than you, or may capable, or more creative in the area you need them. If this is the case don’t do what a majority of self indulged insecure CEO’s do…rather do what you should….support them in a way that allows them to support you. If you are hiring a co-founder that you don’t believe is more capable than you in at least one major area you should not be hiring them as an employee let alone a Co-Founder.


If you feel you can wait a couple of months then either you are not where you need to be to hire a true mover, or they are not true mover. Businesses are moving forward or backward, so why would you wait unless you had a reason? If there is a reason, what is that reason?


Finally what does your business plan dictate in terms of overall operational plan as well as financial plan. Does this person bring a major element to making your startup a success? If they do, then move it forward and evaluate compensation (Which hopefully you have done already before taking this person’s time.)


lwitiko katule Manager& CEO

April 6th, 2021

Neither of the above . What you need to do is bringing them in as soon as possible after you have already discussed with them and hinted all the potential areas to work together, mutual understanding , defining their roles in a startup