Win 5% Startup Ownership by making a Kick-ass Design

Interesting idea.

5% of any company is a huge chunk, especially for just a few hours of work! (In one company I founded, I only held 10%.)

If you win and these guys exit, you stand to make a few dollars.

Conversely, 5% of nothing is nothing. :-)

This is a great idea though overall. For one, it's an easy way to get a good design for "free" for the owner. From an up and coming designer's POV though, it's a great resume/portfolio addition that could actually have a payoff in future years.

Me, myself and I take note.

I don't think you want random entries. Why not interview respectable designers and offer 5% to the the one who agrees as well as has the best portfolio, references, and ideas you like? That's a much more sane thing to do (considering somebody mentioned here at least one law firm in California offered to incorporate some companies in exchange for small ownership of the new entity, and small independent game developers often offer game royalties to artists in exchange for artwork.)

But the best plan, and one most congruent to advice you would get from both the programmers (successful game developers, business-savvy hackers, etc.) as well as the artists themselves (designers: www.no-spec.com) is this:

1) ask around for recommendations on designers who've done related work before and how they were like to work with

2) establish what you are looking for, together with the designer, and let him or her create the art, of course making sure to have a contract that stipulates what is to be done and allows for a couple of additional levels of iterations

3) pay an agreed upon amount, not stock options. Yes, although I mentioned that some indie game developers go the route of offering royalties to artists, the real advice is to pay a flat amount to contractors for art, sound, and music and then keep full ownership of the game, and save lots of time and money managing royalties for the entire lifespan of the game, worrying about trust and tax issues, creating contracts with others, and more.

As well, on the hacker side of the equation, the author of the submission mistakingly equates "offering a few lottery tickets that might win five to seven digit figures" with "attracting the best designers." If you want to have a good design, you will have to do the leg work, and not throw it to chance and then say, "well, I tried! Let me offer 5 or 10 more percent."

And here's a new submission that design contests might not even be legal: http://news.ycombinator.com/item?id=443758

I wonder who got the first 5% for coming up with such terrible domain name?