Interesting. Thanks for sharing, I am very interested in seeing how this goes. More experiences and stories help.
Man, I really feel like you're in a tough spot here. I'm also still seeing a bunch of red flags (what would be red flags in my book). At least yellow flags! I mean taking a departure from tech to get an MBA is great, believe me I wish I could do it myself...But I also have great concern when someone sharply changes their career direction. It could be a problem with follow through. Where's his MBA from? Why did he get it?
It's also really hard to throw around an MBA, certification, or any education as a way to justify a higher equity stake. It comes off as grasping for straws. It's a sell. He's selling you and I'm not surprised now understanding he has an MBA. Actually, it's a positional argument and that's not going to lead to anything good ("Getting to YES Negotiating Agreement Without Giving In" is an amazing book I highly recommend and must remind myself to spend more time going over myself).
To me it sounds like he's dependent upon some outsourced team...Have you seen any of his code? Does he have a GitHub page even? And why his developer team isn't even in the same country I don't know. I mean is he from Costa Rica? Is this where his friends and business connections are? Ok, that'd make sense... But if this guy has no developer resources from his own country...city...state... Why?
His dismissal of your time is also positional and to be frank, kinda insulting. I mean it hurts for someone to say that time and money isn't worth much or anything. That's not true at all. 700+ hrs is not worthless. That's $70,000 at a modest rate. My rate. AND you put in cash of $4,000. Your leads that haven't converted yet, fine. Hard to place a value one could argue...But that plus everything else I see absolutely no reason why you don't have $100,000 worth of value +/-.
It is your decision to take that investment and hand it over to someone else. Yours alone. But I would be trying to ensure you got that same level of value from him. I think the Grunt fund is perfectly fine and fair and I think it was a wonderful suggestion by people here. However, don't forget, you still need to add your value and investment and work to that equation.
You both have pills to swallow. If he can truly add value then you have to decide if it's 50/50, 60/40, or whatever. Maybe it is 50/50. There's no real rule here as you've heard from people...
But I think the pill swallowing on your end should be living with what you give up and the bill swallowing on his end should be that he's not entering this game at ground zero and he's joining you after wheels were in motion.
I say this partially as a frustrated tech person who has been taken advantage of enough times in life. I'm getting good at spotting a good screw. But of course I only have limited insight here. Please take my red flags with a grain of salt, but don't lose sight of your hard work.