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Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

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Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#41

Post by subwindow »

drinko wrote: post #9

i am near Tulsa, Oklahoma. We have a prototype, but not one I would be able to release, as it needs a lot of user interface refining. It is an online web app service for patients with chronic conditions that helps them manage their problems and has some social network features. (I am a nurse)

Is this purely a community support kind of thing? Or does it allow the patients to manage their condition using the site?

I probably can't help because of a non-compete (I'm working on something that sounds almost identical, minus social networking). However, this space is always interesting to me.

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#42

Post by tptacek »

aonic wrote: post #35
redorb wrote: post #11

Earlier quoted context omitted.

because she agreed to 6% and $6,900/mo (a lot more than the founder) ... I think loyalty means something, be loyal to what you agree to; or quit... but don't hold the whole company hostage being selfish. I still stick with the "better off without her" mantra here.

If you are a paying your developer a market value salary, you are basically paying to have your idea developed. Unless you were paying the developer very little, or nothing, that is when equity should be used as payment 35% is a LOT with $6900/m

What was the nurse doing? Ideas aren't worth 65% of the company alone.

I don't know if it's intentional but it seems like a lot of people here are talking as if there were "rules", like "x% is fair, y% is unreasonable". There are rules of thumb. But compensation is a marketplace. If the founder has no leverage, taking a lower stake in exchange for salary isn't honorable. It's just stupid.

Both parties need to feel like they're getting a square deal. If either of them don't, it doesn't work.

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#44

Post by drinko »

tptacek wrote: post #8
redorb wrote: post #5

I think she made a "douche-move" by upping her equity forcefully while still taking $6,900/mo - To be honest no matter the turn out your better without her cause she is lacking integrity.

Why? Even at 35%, she's got much less equity than the original founder. If her market value is 80k, and they're taking salaries, what do you expect her to do? Talent is a marketplace. It isn't owed to anybody.

The investment round was 20%, and I have a 45% stake.

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#45

Post by sonink »

Even if you are able to get it out with the help of another developer(on contract or otherwise) it still doesnt cut it because this is just beta and there is a long way ahead for you to build a business.

For this reasons, and still more, I would suggest that to take this forward you absolutely need a technical co-founder. Try to find one, and even if you have to give a very high (~40-45% stake) consider it a good deal.

Additionally, 12 months is too long a time for beta. Cut down your featureset ruthlessly so that only the ones required to expose the core functionality of your site remain.

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#46

Post by tptacek »

tptacek wrote: post #28
drinko wrote: post #9

i am near Tulsa, Oklahoma. We have a prototype, but not one I would be able to release, as it needs a lot of user interface refining. It is an online web app service for patients with chronic conditions that helps them manage their problems and has some social network features. (I am a nurse)

If the backend and basic interaction works, there are tens of consultancies who can turn it into a presentable, usable, launchable web application. For a complex application, you're probably looking at 15-25k.

No, really, there are. =)

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#47

Post by aonic »

tptacek wrote: post #42
aonic wrote: post #35

Earlier quoted context omitted.

If you are a paying your developer a market value salary, you are basically paying to have your idea developed. Unless you were paying the developer very little, or nothing, that is when equity should be used as payment 35% is a LOT with $6900/m

What was the nurse doing? Ideas aren't worth 65% of the company alone. I don't know if it's intentional but it seems like a lot of people here are talking as if there were "rules", like "x% is fair, y% is unreasonable". There are rules of thumb. But compensation is a marketplace. If the founder has no leverage, taking a lower stake in exchange for salary isn't honorable. It's just stupid. Both parties need to feel li…

It doesn't matter what the nurse was doing, the developer was getting paid a good amount of money.

If I was hired to do a project, and my payment was inline with my market value, I wouldn't care what my employer is doing as long as I kept getting my money.

$6900/m sounds like market value to me. If I was in the nurses position, I would have offered 1% equity on top of $6900/m

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#48

Post by huhtenberg »

So what exactly do you do on a daily basis that effectively prevents you from "getting a real job" ? To put it bluntly - I can't really think of what a non-tech person can be doing full-time for 12 months while waiting for the beta to be done.

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#49

Post by drinko »

pg wrote: post #36

I realize this won't sound encouraging, but it seems to me that you were doomed from the start. Whoever writes the code in a web startup has to be a full cofounder-- which means a friend, not just a stranger you recruited for this project. You've inadvertantly shown why this custom exists. Trying to outsource the development would just be repeating the same mistake. Your best bets would be either to learn to hack, or…

pg,

The idea was that always that she would be a full co-founder. We agreed on a low equity split initially because of the asymmetric risk we were taking. The idea was always to increase her stake 6 months into the project, but not in the way it happened.

I met her through a friend, and 3 months ago would have been proud to call her my cofounder.

I am going to learn to hack regardless, I am just trying to figure out the best way forward in the short term, as the payoff for learning to hack will be a few months.

Re: Ask YC: Startup crisis. Out of money and tech co-founder has bailed.

#50

Post by bigtoga »

tptacek wrote: post #26
tomh wrote: post #21

Earlier quoted context omitted.

I think 6% is actually pretty sweet, I built a 1.0 for a startup from scratch while in grad school, and got all of a 0.5% stake, plus consulting fees. Usually a large slice of the equity pie assumes that you are taking a hit in the wallet now for something better down the road. I believe your developer felt like she was getting the best of both worlds.

That totally depends on the app, doesn't it?

I think it depends less on the app and more on the negotiating power/experience of each party.
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