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Ask HN: Those who've joined a friend's startup as an employee, how did that go?

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Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#171

Post by mooreds »

I joined a friend's early stage company. We weren't close friends, but we'd known each other for a long time and saw each other socially. He also had a co-founder I'd met once or twice.

It was nice to have the co-founder in the mix because that was more of a pure business relationship. I remember the co-founder making a comment about how I'd need to perform and that felt okay. If my friend had said it, it would have stung a bit.

I was nervous, and it was a big commitment for them, so we stepped into it slowly. I contracted for them for a few months before joining full time. That helped alleviate worries on both sides, I think, because I saw how they operated and they saw the work I did.

It worked out well, in the end. They got some great work out of me, I got paid well and had a lot of trust and autonomy.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#172

Post by illys »

ChrisMarshallNY wrote: post #163

One of my favorite quotes is attributed to Saint Augustine: "If two friends ask you to judge a dispute, don't accept, because you will lose one friend; on the other hand, if two strangers come with the same request, accept, because you will gain one friend." It sort of applies, here, as well.

If two friends ask you to judge a dispute, and you don't accept... You might loose two friends since both of them think they are right and will not understand you do not support them.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#173

Post by Gooblebrai »

navane wrote: post #162
fauigerzigerk wrote: post #151

Earlier quoted context omitted.

>BUT, if you decide to sell them, you can't just sell them to a specific person over the counter. You'd have to sell on a market so that anyone can potentially buy them and potentially outbid your intended investor. So if I was looking for someone who would build a company with me, someone who would take on an entrepreneurial role, provide expertise, labour or personal connections, I wouldn't be allowed to do that. I…

>>BUT, if you decide to sell them, you can't just sell them to a specific person over the counter. You'd have to sell on a market so that anyone can potentially buy them and potentially outbid your intended investor. >So if I was looking for someone who would build a company with me, someone who would take on an entrepreneurial role, provide expertise, labour or personal connections, I wouldn't be allowed to do that.…

I prefer the world where I can decide who I sell shares to.

If my investors are going to bug me over returns eventually, I prefer to have control on who they are rather than leaving it to strangers in the open market that may be misaligned. That's one extra reason many companies don't go public nowadays.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#174

Post by ozim »

wahnfrieden wrote: post #22
YZF wrote: post #12

I joined a friend's business as an employee and worked for him for years. I think for the most part that went ok but the fact that we're not friends any more probably tells you something. At some point I felt like I was being taken advantage of, left, and that sort of ruined the friendship. We weren't particularly close friends to start with and we were still on talking terms when our work relationship ended. I also…

Anyone giving you a wage while seeking a profit instead of partner equity is taking advantage of you tautologically

Anyone giving you equity instead of a salary in cash is looking to take advantage of your not understanding what equity really means.

How major shareholders can change the deal by dilution, how can they just spin up separate entities to compete with what you have even though it might seem they are on the same boat while in reality they are not.

One would say "you can always go to court" - can you? If guy that gives you equity was already in the game he already has lawyers and most likely more capital in his pockets. If your equity will be worth $200k and he drags court case so you have to pay for your lawyers $300k in fees is it worth? Especially if you are an engineer that has mortgage instead of loads of cash in bank or other investments. Can you stretch $100k over to win the case and then even if you win and he has to pay you back all the costs with interests, you believe someone will just wire up it in one day instead of dragging it out for another 10 years where you as small time guy cannot sleep at night because all of the crap.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#175

Post by gcnnbdff »

rgblambda wrote: post #167
randerson wrote: post #62

Poorly. I did all the work while my friend goofed off and ran personal errands all day. The friend eventually made a fortune selling their equity and retired young. I did not get awarded the same privilege. We no longer speak and I still get angry when I think about that. On the other hand, I have made good friends through the workplace who I would start a startup with in a heartbeat.

>while my friend goofed off and ran personal errands all day. "A CEO's high compensation is justified by the skills, experience, and dedication they bring to the role." I doubt this is only an issue at startups. I've noticed that the higher up the rungs of the corporate ladder you climb, the easier it is to get away with doing nothing all day.

[dead]

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#176

Post by dotnet00 »

wahnfrieden wrote: post #22
YZF wrote: post #12

I joined a friend's business as an employee and worked for him for years. I think for the most part that went ok but the fact that we're not friends any more probably tells you something. At some point I felt like I was being taken advantage of, left, and that sort of ruined the friendship. We weren't particularly close friends to start with and we were still on talking terms when our work relationship ended. I also…

Anyone giving you a wage while seeking a profit instead of partner equity is taking advantage of you tautologically

This does not account for the investment in terms of personal risk.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#177

Post by polynomial »

michaelt wrote: post #166
geraldhh wrote: post #116

Earlier quoted context omitted.

> As it was it left me scrambling with three small kids. you did not mention whether this early termination was communicated beforehand. nevertheless this person probably never was your friend. sry

> nevertheless this person probably never was your friend. sry No, it's completely common for friendships to break down over business. Very few friendships are robust enough to survive one party costing the other $20,000.

So we can put a price on friendship? (/s)

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#178

Post by polynomial »

rgblambda wrote: post #167
randerson wrote: post #62

Poorly. I did all the work while my friend goofed off and ran personal errands all day. The friend eventually made a fortune selling their equity and retired young. I did not get awarded the same privilege. We no longer speak and I still get angry when I think about that. On the other hand, I have made good friends through the workplace who I would start a startup with in a heartbeat.

>while my friend goofed off and ran personal errands all day. "A CEO's high compensation is justified by the skills, experience, and dedication they bring to the role." I doubt this is only an issue at startups. I've noticed that the higher up the rungs of the corporate ladder you climb, the easier it is to get away with doing nothing all day.

> I've noticed that the higher up the rungs of the corporate ladder you climb, the easier it is to get away with doing nothing all day.

Same. Absolutely not in question.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#179

Post by boeingUH60 »

jongjong wrote: post #139
fauigerzigerk wrote: post #118

Earlier quoted context omitted.

> IMO, it should be illegal to launch a limited liability company/corporation and only allow specific people to buy shares. I object to the idea of incorporation and limiting directors' liability to begin with but since it is allowed, at the very least, it should be a requirement under the law that the shares be on the open market such that anyone who wants them can buy them and resell them at any time. I don't under…

>> If I start a company on my own and I provide all the equity then I own all the "shares". What would it mean for those shares to "be on the open market"? If I'm not selling them then no one can buy them. If you own all the shares initially, it means you get to set the price to whatever you want (and hope that someone is willing to pay that price), or you can just hold them and keep them all to yourself. BUT, if you…

Hell no, if I start a company, I don't want any random clown to be able to purchase shares in it and start influencing my business.

Most businesspeople think the same.

Re: Ask HN: Those who've joined a friend's startup as an employee, how did that go?

#180

Post by xrd »

michaelt wrote: post #166
geraldhh wrote: post #116

Earlier quoted context omitted.

> As it was it left me scrambling with three small kids. you did not mention whether this early termination was communicated beforehand. nevertheless this person probably never was your friend. sry

> nevertheless this person probably never was your friend. sry No, it's completely common for friendships to break down over business. Very few friendships are robust enough to survive one party costing the other $20,000.

It's wild that you said that amount because that was exactly the number.

I have other friendships that have been tested for similar amounts that have survived. But, it leaves a mark.

I had an ex-employee who worked for me under starvation wages in a startup long ago. He was upset about that and some tax implications, and brought it up with me. I gave him a smallish lump sum and enabled him to put a down payment on a house. I need to ask him about that, it was really brave to ask me to clean something up, and I never did that with the friend from the OP. I wonder if it would have gone differently.

I'm seeing a lot of people in my circle struggling right now. I bet 2024 is going to be a bad year for friendships.

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