YoungUpstarts

DECEMBER 1, 2020

by Joel Patterson , the founder of The Vested Group and author of “ The Big Commitment: Solving The Mysteries Of Your ERP Implementation “ As a challenging year winds down, companies are sifting through what worked and what didn’t as they prepare to reboot for 2021 after dealing with the many difficulties brought on by the pandemic.

Vesting 221

Vesting Software Review Leadership Employee 221

Startup Professionals Musings

MAY 1, 2023

Even with an agreed initial equity split, it’s smart to have Founder’s stock actually issue or vest over a period of at least two years, on a month-by-month basis. The CTO of many technical startups was the original founder. Obviously it should be amended later, as roles are more clearly defined, and execution proceeds.

Technical Cofounder 247

Technical Cofounder Equity Distribution Cofounder 247

Hunter Walker

FEBRUARY 20, 2024

Founder Vesting [Jared Hecht/USV] – Jared joined USV earlier this year and it’ll be interesting to see how his writing changes as he adds ‘institutional VC’ to his founder and angel investor knowledge. Stretching things out to a six-year vest helps to prevent co-founder abandonment.

Founder Vesting 59

Founder Vesting Vesting Cap Table Founder 59

Both Sides of the Table

AUGUST 15, 2012

I recently read Brad Feld’s thought provoking piece encouraging founders to sit on the board of another startup company. I found it thought provoking because I’ve always believed startup founders need extreme focus on only their company to succeed. You’ll understand “fiduciary responsibility” more deeply. .

Founder 294

Founder Vesting Startup Stock 294

Eric Friedman

NOVEMBER 18, 2022

I have had a few founder friends reach out to me asking about how much equity to give to an advisor, and had some operators reach out asking how to become an advisor for an early stage founder. An underutilized action by founders is canceling their vesting due to lack of interaction or help with your company.

Early Stage 103

Early Stage Equity Vesting Cap Table 103

Startup Professionals Musings

SEPTEMBER 27, 2023

Every entrepreneur needs to understand the following basics, to be addressed at company formation, as they engage a qualified attorney to draw up the paperwork: Allocate founder’s stock commensurate with commitment. This is the purpose of a vesting schedule, which issues allocated stock over time.

Stock 240

Stock .Net Vesting Founder Vesting 240

Startup Professionals Musings

MAY 8, 2022

Most entrepreneurs struggle with many startup founders quandaries in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. Should you start a company solo or find co-founders to help you? The co-founder relationship dilemma.

Founder 325

Founder Hockey Stick Cofounder Liquidity Event 325

Startup Professionals Musings

SEPTEMBER 10, 2018

I always tell entrepreneurs that two heads are better than one, so the first task in many startups is finding a co-founder or two. Giving a co-founder a salary won’t get you the “fire in the belly” you want. Each co-founder should get equity for value, based on these key variables: Lived a key role in a previous startup.

Equity 238

Equity Cofounder Technical Cofounder Intellectual Property 238

The Startup Toolkit

FEBRUARY 15, 2013

false As a cheatsheet, the “normal” equity structure is: Founder terms: 4 year vesting, 1 year cliff, for everyone, including you. 2.0% ) : 4 year vesting, optional cliff, full acceleration on exit. When it comes to equity terms, there are only 3 things to understand: vesting, cliffs, and acceleration. Advisor terms ( 0.5–2.0%

Vesting 56

Vesting Equity Cofounder Technical Review 56

SoCal CTO

SEPTEMBER 27, 2011

Founders vs. Early Employees To help with this discussion, let me start with a definition of "early employee." The first few people into a startup are on a spectrum of founder vs. early employee. Founders are likely not paid for a long time and have a sizeable equity percentage for early risk and having the concept.

Early Stage 391

Early Stage Equity CTO Hire Sweat Equity 391

K9 Ventures

OCTOBER 27, 2016

One of these norms is how founder vesting and employee vesting works. I won’t get into employee vesting today as that has much more to consider than I have time to cover in this short post today. Here is a good summary post from Cooley GO on Founder Vesting. The first is fairly obvious.

Founder Vesting 48

Founder Vesting Vesting Founder Term Sheet 48

Startup Professionals Musings

JANUARY 15, 2021

Every entrepreneur needs to understand the following basics, to be addressed at company formation, as they engage a qualified attorney to draw up the paperwork: Allocate founder’s stock commensurate with commitment. This is the purpose of a vesting schedule, which issues allocated stock over time.

Vesting 298

Vesting Dilution Stock Founder Vesting 298

The Next Web

JULY 21, 2013

You have an awesome idea and a great co-founder with whom you want to work. This is why vesting is so important. Investing in vesting. In essence, vesting protects founders from each other and aligns incentives so everybody focuses towards a common goal: building a successful company. An example.

Vesting 143

Vesting Founder Chile Equity 143

Scott Edward Walker

OCTOBER 19, 2020

In a couple of cases, the founders played lawyer on their own; in the other cases, the founders either used (i) a Web service that did not address IP issues or (ii) an inexperienced law firm. This would arise as a result of a founder improperly “moonlighting” (i.e., Any IP created by a founder (e.g.,

IP 52

IP Software Review Founder Technical Review 52

View from Seed

JANUARY 5, 2016

At the beginning, a startup team is typically just a couple of co-founders. What we suggest at this juncture is that founders get acclimated to the tactics of scaling beyond the founding team. What to Address During Genesis Team Building: How do we divide and conquer responsibilities as co-founders? Below, I take a look at each.

Founder 120

Founder Cofounder Startup Early Stage 120

SoCal CTO

NOVEMBER 1, 2010

I had a recent email dialog with the founder of a company looking for a CTO for their startup. And I tried to evaluate the idea and figure out: What did the founder really need here? Was it a Startup Founder Developer Gap ? And do I fit as a Part-Time CTO , Technology Advisor , CTO Founder , Acting CTO ?

Technical Cofounder 241

Technical Cofounder CTO Hire Equity Sweat Equity 241

The Next Web

NOVEMBER 20, 2013

With all other things equal, that means that a 50/50 split between two co-founders (evenly split if there are more than two), or a 66/33 split based on the premium for coming up with the original idea, and for starting the initial development efforts and sourcing the original team. Whose idea was it? How important is this person’s role?

Cofounder 136

Cofounder Equity Founder Seed Stage 136

VC Adventure

AUGUST 16, 2020

It strikes me that many founders never really consider this question. Many founders feel that it’s equitable to have everyone share in the upside and feel like owners. My background thesis inherent in this is that employees with options should continue to vest new option as they continue to work for your business.

Programming 149

Programming Vesting Equity Software Review 149

thinkspace.com

SEPTEMBER 7, 2012

How to Divide Equity to Startup Founders, Advisors, and Employees. The part that I’d like to zero in on is when you’ve got a high growth company what are some of the best practices out there to distribute equity to the founders, advisors, and employees? Equity for Founders. Should founders have anti-dilution rights?

Equity 62

Equity Employee Founder CTO Hire 62

Startup Professionals Musings

APRIL 23, 2012

One of the first tough decisions that startup founders have to make is how to allocate or split the equity among co-founders. In many cases, one founder has started earlier and brings an important completed piece of work to the table, and that can have great value. The same logic applies to splitting equity with co-founders.

Intellectual Property 252

Intellectual Property Equity Cofounder CTO Hire 252

Both Sides of the Table

MAY 9, 2011

I covered what I call “the co-founder mythology.&# Either you’re not technical and you think you need a technical co-founder or vice-versa. It is increasingly popular to have “founder dating&# or “startup weekend hackathons&# of some variety or the other. Hire your co-founder. Vested over 4 years.

Cofounder 393

Cofounder Founder Vesting Founder Vesting 393

Austin Startup

DECEMBER 9, 2019

Sputnik ATX Three rules to avoid getting scammed by advisors As an early stage VC, one of the saddest things I observe from meetings with founders is the toxic and pervasive influence of what I call the start-up industrial complex (the SIC). Founders, we love you and want to see you succeed. This is a bad deal for you, if you take it.

Vesting 72

Vesting Early Stage Seed Capital Equity 72

The Startup Lawyer

JANUARY 27, 2018

One of the most asked questions I receive when setting up new startup companies is “Do my vesting shares have any voting rights?” ” Or in other words, does a stockholder only get to vote based on their amount of vested shares?

Vesting 52

Vesting Founder Startup 52

The Next Web

OCTOBER 7, 2013

They were referring to non-founder engineers, most commonly the first hire for technology businesses. is frequently granted ownership significantly less than that of the founders. However, at the very early stage, they are taking as much risk with their future as the founders. Engineer #1?

Engineer 129

Engineer Dilution Option Pool Vesting 129

Startup Professionals Musings

NOVEMBER 8, 2010

One of the first tough decisions that startup founders have to make is how to allocate or split the equity among co-founders. In many cases, one founder has started earlier and brings an important completed piece of work to the table, and that can have great value. The same logic applies to splitting equity with co-founders.

Equity 228

Equity Intellectual Property Cofounder CTO Hire 228

Both Sides of the Table

AUGUST 17, 2009

The meme was kicked off by Chris Dixon with this post saying that term sheets need to be simplified and align investor / founder interests. This is part of my ongoing series “Pitching a VC“ There’s a great meme developing this morning on the need to simplify funding terms and documents.

Founder Vesting 252

Founder Vesting Vesting Founder Term Sheet 252

Both Sides of the Table

FEBRUARY 20, 2019

One of the things that founders have the most angst about is whom they should have on their board and at what stage of the business. Why you should set up a board at the seed round of funding I know these days with SAFE documents and rolling convertible notes many founders prefer not to set up a board early on.

Venture Capital 236

Venture Capital Startup Angel Investor Silicon Valley 236

Feld Thoughts

SEPTEMBER 2, 2011

The founders each have common shares that will vest over four years. The vesting schedule protects each of the co-founders in case one gets hit by a bus or decides to drop the project after a short period of time. Bring Praveena in as a founder and offer 10-20% of the company as stock. Time to update the cap table.

Cap Table 133

Cap Table CTO Hire Technical Cofounder Cofounder 133

venturehacks.com

FEBRUARY 24, 2010

SUPPORTED BY Products Archives @venturehacks Books AngelList About RSS How to pick a co-founder by Naval Ravikant on November 12th, 2009 Update : Also see our 40-minute interview on this topic. Picking a co-founder is your most important decision. One founder companies can work, against the odds (hello, Mark Zuckerberg).

Cofounder 101

Cofounder Founder Technical Cofounder Technical Review 101

The Startup Magazine

FEBRUARY 21, 2024

Arif Bhalwani is the co-founder and CEO of Third Eye Capital (TEC) in Toronto, Canada. This hands-on approach is indicative of a vested interest in the success of the business, far removed from the notion of lending to “bad” companies. The firm has made more than $4.5

Technical Review 133

Technical Review Due Diligence Bankruptcy Intellectual Property 133

Both Sides of the Table

FEBRUARY 14, 2018

If you haven’t yet heard about Female Founder Office Hours it is an initiative you should be aware of whether you’re male, female or any other gender identify. Female Founder Office Hours gives founders the mentorship and the role models to see that it is in not only possible but also to have a plan to make it a reality.

Founder 256

Founder San Francisco Deal Flow Los Angeles 256

Startup Professionals Musings

AUGUST 24, 2016

I always tell entrepreneurs that two heads are better than one, so the first task in many startups is finding a co-founder or two. Giving a co-founder a salary won’t get you the “fire in the belly” you want. Each co-founder should get equity for value, based on these key variables: Lived a key role in a previous startup.

Equity 120

Equity Cofounder Technical Cofounder Intellectual Property 120

Scott Edward Walker

SEPTEMBER 28, 2011

Question My co-founders and I are working on a cool new site, and we’ll be ready to launch in a few weeks. Vesting Restrictions. The first deadly mistake relates to vesting restrictions. Otherwise, if one of the founders quits after a few months, he would take all of his shares with him.

Vesting 89

Vesting Software Review IP Intellectual Property 89

Scott Edward Walker

DECEMBER 14, 2015

One of the biggest mistakes I see startups make is failing to set-up vesting schedules for the founders. v=-R01YcgJ3Yw What Is a Vesting Schedule? A vesting schedule is a mechanism by which the ownership of the stock issued to the founders is earned over time (typically four years, as discussed below), rather than immediately.

Vesting 40

Vesting Founder Stock Cofounder 40

SoCal CTO

JANUARY 18, 2011

I have been working full time with two founders for about 10 months on full time basis. During that time one of the founders had mentioned that for the initial agreed time (3 months, equivalent dollars could be translated to 2% of equity but no agreement was reached at that time). What are the terms the founders got in the deal?

CTO 167

CTO CTO Hire Equity Vesting 167

Scott Edward Walker

FEBRUARY 1, 2014

Mistake #3 : not setting-up vesting schedules (at 17:19). different perspective as a lawyer (lots of phone calls from founders with problems). Zuckerberg” problem – IP is not assigned to the company by the founders and/or third-party developers (including in foreign countries). Mistake #3: Not Setting-Up Vesting Schedules.

Software Review 111

Software Review Delaware Accredited Investor Due Diligence 111

Scott Edward Walker

FEBRUARY 1, 2014

i) Rule 506 preempts State law, which means all you have to do is file a Form D and pay a filing fee; and (ii) no disclosure requirement/PPM Possible to sell to “friends and family” (e.g., issues to address include: How have they treated their other portfolio companies? Are they good guys or jerks? Can they be counted-on and trusted?

Software Review 111

Software Review Delaware Accredited Investor Due Diligence 111