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Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

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Re: Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

#141

Post by jelliclesfarm »

gkoberger wrote: post #117

Can I give you some advice that really sucks? Walk away. It's not fair, but starting a company isn't like getting a job. It's a relationship and a risk that doesn't always work out. Sometimes you find more money and success than you could ever dream of, and other times you waste 11 months. Here's my thought process. You and your cofounder aren't going to be able to work together after this. The company has no money a…

i agree. you are not left with a lot of options. walk away. having been in somewhat similar position, i can tell you that it's not worth it. good luck.

having said that, you can walk away. and still piss on their cake.

but this a toxic partner. you cannot work with them. that's for certain. you will have to walk away.

Re: Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

#142

Post by stale2002 »

gkoberger wrote: post #117

Can I give you some advice that really sucks? Walk away. It's not fair, but starting a company isn't like getting a job. It's a relationship and a risk that doesn't always work out. Sometimes you find more money and success than you could ever dream of, and other times you waste 11 months. Here's my thought process. You and your cofounder aren't going to be able to work together after this. The company has no money a…

> Them raising money to pay you just kills their chance at ever being successful

> there's no way they can build a company when someone not involved owns a huge stake.

So what? That sounds like their problem, not his.

> But I'm 99% confident you won't get anything out of this, so it's best to just walk away.

Possibly. But is that is the case, why not just keep the 40%? He's got nothing to loose. So in that case, there is no need to give in to someone else being unreasonable.

Re: Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

#144

Post by silexia »

lostsoul8282 wrote: post #131
gkoberger wrote: post #117

Can I give you some advice that really sucks? Walk away. It's not fair, but starting a company isn't like getting a job. It's a relationship and a risk that doesn't always work out. Sometimes you find more money and success than you could ever dream of, and other times you waste 11 months. Here's my thought process. You and your cofounder aren't going to be able to work together after this. The company has no money a…

I agree. They can fight this and drain energy but they will only get what they deserve up to this point. Which might be worth fighting for but if you believe that that you can do better, I would walk away - no agreement/liability to the company and if they are passionate about the idea rebuild it with a stronger team quicker. The difference this time is they is more knowledge, clearer path and knowledge of what a com…

This comment and the parent comment are absolutely right, but they are not decisions I would have ever thought of myself. Kudos to both of you!

Re: Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

#147

Post by gkoberger »

stale2002 wrote: post #142
gkoberger wrote: post #117

Can I give you some advice that really sucks? Walk away. It's not fair, but starting a company isn't like getting a job. It's a relationship and a risk that doesn't always work out. Sometimes you find more money and success than you could ever dream of, and other times you waste 11 months. Here's my thought process. You and your cofounder aren't going to be able to work together after this. The company has no money a…

> Them raising money to pay you just kills their chance at ever being successful > there's no way they can build a company when someone not involved owns a huge stake. So what? That sounds like their problem, not his. > But I'm 99% confident you won't get anything out of this, so it's best to just walk away. Possibly. But is that is the case, why not just keep the 40%? He's got nothing to loose. So in that case, ther…

From a purely legal perspective, this is incorrect.

He's on a vesting schedule, and currently has 0% (his cofounder also has 0% currently, assuming they started at the sam time). They both entered this agreement to only get ~40% if they work there for 4 years (and at that point, they'll likely have to revest).

Vesting schedules were created for this exact situation.

Re: Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

#148

Post by notahacker »

fortydegrees wrote: post #33
gwbas1c wrote: post #23

Earlier quoted context omitted.

I think this works if fourtydegrees has some bucks in the bank. Reading between the lines, I suspect fourtydegrees is young and doesn't have the kind of money to do this. (I also suspect that lawyers may be out of fourtydegrees' budget.)

Suppose I did have some bucks in the bank and did get a lawyer - how would they help? So far my co-founder has been pretty unreasonable with regards to compromising and/or negotiaton. The investor so far has also been very neutral and I think will remain so.

Whilst the investor might consider that taking sides in personal aspects of the dispute looks unprofessional and might not see your compensation as a priority, surely the only way they could actually be truly 'neutral' on the future of the business is if they've already written the investment off as a bad one. (Which in itself would be useful to know)

Otherwise I would expect them to be (i) interested in ensuring the underlying tech was maintainable in future, which if nothing else might result in more reasonable earnout possibilities for you and (ii) concerned that one of the founders apparently wishes to cut others out of the business to turn it into his personal cash cow, particularly if the other founder is the one with monetisation ideas.

It's not guaranteed that the investor is your friend (another possibility is that replacing you and taking the business in a different direction is something they quietly encouraged) but I wouldn't expect them to be 'neutral' on whether the business has a chance of generating them a return or not.

Re: Ask HN: Co-founder wants me to leave but won't entertain a buy out offer

#149

Post by robocat »

clarkevans wrote: post #55
basseq wrote: post #34

Since you have a 1-year cliff and have only been there 11 months, sounds like as of today you have 0% equity. So the immediate question may be whether your co-founder can fire you. In 1 month, you've vested 25% of your grant, or 10% of the company. So I would try to get to that mark to strengthen your negotiating position. Any references to 40% are red herrings at this point. Unless there's a specific buyback clause…

10% might be a good target from another perspective -- the investor put in 100k to get to 10% -- is that about how much "sweat-equity" that the OP has put in? Alternatively, just pretend the vesting was happening monthly.. how much is that 9.16%? The surviving founder does need enough incentive to continue. The OP should make sure it is hard equity of the same class as the investor's shares, where there are tax liabi…

> the investor put in 100k to get to 10% -- is that about how much "sweat-equity" that the OP has put in

Another way to look at it: their sweat equity is more like $1 million e.g. $100k “time” invested with a risk of success of 1 in 10 means you need to get $1 million out to be “even” (ignoring Kelly Criterion).

Obviously there is some Bayesian that goes on now that there is more information, but it seems like it has a better chance of success than when it started, which makes numbers more difficult to calculate than complete failure ($0).

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