Equity or a flat fee to build a core product for a startup?

I am currently talking to the CEO of a startup. I am a tech guy who is planning to build the core product for a startup. And I am planning to work on part time basis. My plan is to build the core product in 2-3 months and provide product improvement recommendations.

Since its an early stage startup. The company do not have enough funds to hire so I am planning to ask for equity.

How much equity do I need to ask him? Or should I ask for a flat fee to build a product on a contract basis? Please let me know. Thank you 🙂

submitted by /u/rg_cyborg77
[link] [comments]
Startups – Rapid Growth and Innovation is in Our Very Nature!

Is it possible to get a CTO to work on an app for equity only on a great concept in the UK?

I wonder if its possible?

Or does every app developer need payment upfront?

I have had quotes for low prices but ideally equity for equity means the project could get started.

I wonder if this arrangement happens anymore? Or is it always cash up front?

submitted by /u/lamont153
[link] [comments]
Startups – Rapid Growth and Innovation is in Our Very Nature!

Combining Time and Milestone vesting for a CTO – What are some good milestones for a CTO to have to trigger extra equity?

He would be more of a CTO/Co founder hence the slightly larger than usual %. But not that big because I have taken all the risk so far and we are already generating revenue while I've been paying him as a contractor.

I'm currently considering a scenario where:

– He gets 10%, 1 year cliff with 4 year vesting period

AND

– He gets another 5% (which adds the the equity being vested in that remaining year of the above) if the ARR is at a certain level by the end of year 3.

AND/OR

– He gets another another small % if we manage to secure a certain amount of investment within the 4 year time vesting period. But he would need to have made a significant contribution to us being able to get that investment (I don't understand how this would work though if it's more of subjective thing that I decide).

I'd love to hear your thoughts on this, especially from those of you who have been in this situation from the CTO perspective or founder perspective.

Thanks!

submitted by /u/LiquidFootballAha
[link] [comments]
Startups – Rapid Growth and Innovation is in Our Very Nature!

Equity for CTO/Technical Founder joining startup

So I was asked to join a startup about a month and a half ago as the CTO. The CEO or founder had come up with this idea and had been working on it for a year. Not working on the actual application but like the business side of things, talking to manufacturers, traveling to another city to talk to a specific demographic, doing market research, registering the business, hiring other employees, marketing etc. He did have another technical before who kind of did a very basic proof of concept to make sure the idea works but he left and left nothing. Although even if he left something it wouldn’t really have been that helpful since it was literally just testing something, no actual work done on an application. Over this time since I joined I can tell the CEO really wants this to work and hes taking it seriously.

Initially I negotiated with the guy and we agreed on me having 45% equity and one less voting chair than him. Since it was his idea and he had done a lot of the business side of things for this past year I felt that was fair for him. So he has 55% equity and I thought of it Like 5% for it being his idea and 5% for working on it and starting the whole venture this last year, although no actual technical work done more of an idea and research of what devices and the means of how we can achieve this.

I’m wondering is this a good decision or should I go back and try to ask for equal equity or 49% just so that he has majority? I don’t want to be greedy or anything but I’m just thinking I am going to be building the entire thing and I make all the technical and architectural decisions. And I saw this post by a pretty successful technical founder saying devs shouldn’t work for equity unless they’re being brought on as an equal technical co founder. We also don’t really have a dev team, 1 guy who isnt doing anything because of stressful full time work right now and another just joined but he’s also working full time and they both need to learn the stack which will take some time. Another thing to consider is that I am also working on another startup and I made that clear before so I’m not giving 100% of my time but neither is the CEO since he’s doing school and I will be going back to school next term as well. Also I’ve been very involved in the business and product decisions because I’ve had startups experience before.

I’m just wondering what you guys think because my past experiences have been a bit different I joined a team very early on before and they had a really small amount of code written but I joined early on so they hadn’t been working on the business side and everything for a year I don’t think and I was the CTO and equal partner. So do you think this situation warrants me asking to be an equal partner or is 45% equity fair for both of us? Also the CEO also is sketching the UI designs for the application and he said he will be learning some of the stack but he’s still new to coding.

submitted by /u/ayoungtadpole
[link] [comments]
Startups – Rapid Growth and Innovation is in Our Very Nature!

Solve the ‘dead equity’ problem with a longer founder vesting schedule – TechCrunch – Best gaming pro

Solve the ‘dead equity’ problem with a longer founder vesting schedule – TechCrunch  Best gaming pro
“startups when:1d” – Google News