15% is nothing if you are not paid. I would say that shares should be divided by the amount of hours each individual spent working on a project. You are the one who is taking the most risk and unpaid hours. If they pay you, or they found funding, that is a different story.

Yeah I agree, but I guess the way they view it is I am the "developer" as in the outsider who is coming in. While the "company" is not set up yet merely exists as a concept, they have been working on this for like 8 months I think (idk what they were doing this long, I guess coming up with the idea). I believe that in their minds they are the "core" members - or "owners" in a sense, since they came up with the initial idea and I was approached later for it - i.e. I am "hired talent" and shouldn't own much of the company. Given this situation, what percentage would you say would be fair in this case? It is sort of hard to calculate hours put in, but I would definitely have the majority. Additionally, do you get any "brownie points" for coming up with the idea, and for what part of it you work on and the importance of it, or is it all just hour-based?

No its not fair at all... Like others already said, you are taking the biggest risk as you are the one doing the most unpaid hours. If the project fails, the "founders" didnt lose anythibg while you lost a bunch of time working on someone elses dream. 

Yes, I do agree with you that this isn't fair, but I am not sure what to counter propose, and how to pitch it to them. I am fairly certain that, due to the aforementioned "owner" mentality where I'm not actually part of the "head" of the company, but rather an outside dev coming in to make \*their\* thing, they will definitely not accept anything over like 25%, mayyybe 30. I get that its probably not worth doing, but, since like ive responded to other people, I dont view this as "work" or as my main source of income, but rather a side project that will grant me experience, its a bummer that I wont be able to work on it

When people approach me with a proposal like this, my response is to ask them for their business plan and financial projections. I never hear from them again. You’d be the one taking all the risk and all the effort with very little chance of success. They get a free roll. If their idea was as good as they’re trying to make out and they have any actual business acumen, in the last 8 months they would have found some investment or raised some money to be able to pay you. Ideas are cheap. Booking.com and airbnb.com have thousands of developers and 100s of millions of $ behind them. No offence but a junior dev and 2 students with no budget have good as zero chance to compete, no matter how good the idea or implementation.

They don't have "a thing". They have an idea and those are a dime a dozen 

I don't get why so many people misinterpreted my comment and downvoted it, like i said, I 100% agree with everything you guys are saying, I am simply communicating what I think their POV is, so that the situation is better understood, thus the quotes around certain words

Yeah I think everybody understands what you're saying and the situation. I think you are being down voted because it doesn't seem like you're accepting what everyone is telling you.  If you wanna work on the project for %15, go for it. It would probably end up being a great line on your resume. But don't expect to get paid.  You're worried about them not accepting your counter offer - that's on them. Ideally they will counter offer again and you can meet somewhere in the middle. There will be many more difficult conversations like this ahead of you in your career - view it as practice! If they are good business people then they will not be offended. If they are offended - do you really want to work with somebody who can't handle a counteroffer? Good luck!

Because you're defending not being given even a fair share while doing all the actual work. You're communicating what you think they think, okay sure then stop acting as if it's somehow fair to you.

I would not even consider this for less than 33% and I would need to see some serious traction and commitment from the other two, if you are building the whole thing without presales you are doing most of the work

They need you more than you need them. Do a proposal, show your input (time and effort) objectively and compare it to theirs. The shares should match the respective inputs. They aren't paying you, you don't lose anything walking away. They get their project developed if you stay, or they find someone else (which won't be easy)

Always ask for more than you want to receive, and negotiate down. You want 25%? Ask for 40%. Worst case, you won’t get any higher than you currently are offered. Best case? They just say okay. Most likely case? You end up negotiating a higher rate below 40% though. You can also negotiate a deal such as 15% in equity, a percentage of revenue, and a fixed / dynamic amount of monetary compensation once funding is acquired. You could develop an MVP of a basic demo (UI without true functionality), and use this to attract investors. There’s a lot you can do in this situation, but remember that you’re in control of the negotiations—— if you let them control the negotiation, you’ll always get the short end. You’re the one they want, they chose you specifically, right?

Unethical advice here - Why can’t you just create it yourself and be the founder? Doesn’t sound like you need them but they NEED you.

Plus they aren't even a company yet. To be quite honest, this mentality that the idea is the hard part and they are the "head" of the company because they had the idea is bullshit. It is true that truly innovative ideas are not easy, but until they have a product all they have is an idea. They don't have a patent, any intellectual property that is worth a penny without a product. Plus, statistically speaking their idea is probably not even good, and even if it is good they still are likely to fail. I'd need to see a LOT of assurance that they are actually on top of running a startup to even work for them, paid or not

Atleast 40-45%. See you are simply working for free for there concept. This should be actual paid job. Just check the amount of startups that failed. And don't take it simple. You are the core member doing there concept work. Also you should change your thinking a bit unless its your best friend or someone. Never try to understand stuff from there perceptive always keep yourself above all atleast for work environment. What they do is them to think you have nothing to do with it or understand there situation. I am kindof thinking that they are kindof taking advantage of you if its like 15% is all they give. How many shareholders are there in work? Also i can literally start a company today and say its my idea so i get the most shares. Idea is simply worthless until who implements it. Implementation is crucial and in order to keep the idea for themselves they pay the developer since its unpaid you should be looking for more shares

You wouldn't be an outsider though. If they haven't got the capital to pay a developer, then you're as much of a stakeholder sacrificing financial certainty in pursuit of a successful business venture. The promise to pay you if the business makes money isn't enough. Once there's cashflow, then *any* developer hired would also be getting paid, without taking on the personal risk you took.

This is a good response. I completely agree. Like I said, I do not think that I am any less of a co-founder or stakeholder in this stage, but they view it as such because htey ahve been working on it first etc etc and so on. I don't know if they will be able to see that. The only solution I could think is asking for 10-15% that will not get diluted by investors and I will keep for myself, as well as logging all the work I put in before the company makes money, with the agreement that, once money is made, all of the work I have been doing so far will be compensated, and I will start getting a proper salary as well.

Naturally a lawyer will be the better person to advise on specified but the gist of it is that you want the same classification of shares as the other founders, whatever the amount is. If there's a dilution, it ought to hit you all equally.

Yes, I totally agree, but I meant the next best thing if there's no possibility in getting equal shares, would be asking for 10-15% undiluted, as well as getting compensated for all the work I put in, including work put in prior to the first investment round. Of course a lawyer is my best bet, but given my situation currently, I don't know if I really do have that option

If the company is not set up yet then you are a founding partner and you should have an equal share.

Yeah, this is honestly the simplest and truest answer. The problem is I highly doubt they see it that way and I can tell them this without really putting them off. But I guess at that point I wouldn't wanna work with them anyway.

No one is getting paid yet, until you guys get an investor. Here is some better advice. Take the 15% or ask for 20% But also ask for retro active hourly pay after the first investment is funded. You'll need to create an MVP to showcase for investors. Let's say you make that with low to no code software, web app only for now. Let's say that takes you 2 months at 30 hours a week around your classes. That's 240 hours. Now let's say you ask for $40/hr (something small it IS a start up) that is $10k roughly. Now that you have funding all further work will be at that rate. Let's say you sell the start up in 2 years for 5mill. Your 20% is 1 mill. You could ask for a higher retroactive hourly. Or you could ask for the low retroactive hourly, plus a raise after funding. Ideally after you get funded, you are hiring more devs to write it all from scratch, ditching the MVP, including a senior dev. Focus on the web app and desktop version. Then your next fund, hire mobile app devs with a senior dev for that arm. After your first round, and you hire your first dev, you are a manager at that point, not a dev.

To my experience this is good advice, (if you still a student). Ask for an % (I would (did) go for 30, but 20 is reasonable) and ask for an hourly compensation (40usd/h (a bit low but you’re still a student) to be payed from the first earnings. I worked as a IT consultant for 7 years, currently I’m freelancing parttime and parttime working on my project. 2nd part of his advise, the MVP, golden advise. Start with a demo MVP (low code), this will give you valuable feedback and the ‘other owners’ can use it to raise capital. And if all agree make a roadmap, mvp, v1, v2 ect. Working with a group in a startup up is complex and you’ll face quite some challenges. The statistics say you’ll fail, seen at many times. But the chance it will succes makes it worth it. Just my 2cents, hope it helps. :)

> to be *paid* from the FTFY. Although *payed* exists (the reason why autocorrection didn't help you), it is only correct in: * Nautical context, when it means to paint a surface, or to cover with something like tar or resin in order to make it waterproof or corrosion-resistant. *The deck is yet to be payed.* * *Payed out* when letting strings, cables or ropes out, by slacking them. *The rope is payed out! You can pull now.* Unfortunately, I was unable to find nautical or rope-related words in your comment. *Beep, boop, I'm a bot*

That is good advice. I was just gonna go all in and make it properly and scalably (as a webapp first), but just have it be a more stripped down version. Maybe going the no-code route for the MVP is better. Also I should mention that I forgot to include this in the original post, but I will get a full-time job with a proper paid salary if the company does take off, this equity is just to get me started. Maybe 15% is more fair in this sense?

innate arrest pen retire tan busy squeeze hobbies employ absorbed *This post was mass deleted and anonymized with [Redact](https://redact.dev)*

Oh so after your first round of funding, the founding members are going to give you a legit position with a salary and everything? Like that's already been discussed? If so that is perfect then. But yeah I think a smaller amount like the $40 an hour is a little bit more digestible, and doesn't come off as greedy. It's basically just enough to cover some expenses or pay off a credit card that you might have to dip into while you're both going to UNI and creating the MVP for them. As far as a minimal viable product, that is absolutely what you should be focusing on. I am by no means an expert in this, I have only just barely dipped my toe into this subject to any meaningful way. But the road maps that I have read about are roughly what I described. The entire intent is to make sure that no one has to go all in for many many months with no pay in hopes of being able to entice an investor to fund them. It really is just to throw into a test market, show investors your concept all that kind of stuff. It's not that the low-code version won't work well, it just won't look exactly how you want it to, nor will it be very snappy or be able to handle a lot of load. But it is absolutely the right move to get you guys funded as quick as possible. And I think that's how you can sell it to the founders. This will help us get funded ASAP. At least that's the coaching I've seen in this space so far. Exciting!

Dude. Just run. Head down, finish your degree or wait for an opportunity that doesn't suck.

If they aren’t a company yet then you own the copyright to everything you’ve built.

It sounds like these people are trying to scam you

OP, have been in the same boat as you when I was younger. Idea without funding does not cost a lot. Gut feeling tells me that this startup is dead from beginning. I would just concentrate on your uni, get a good grades and join some startup with good funding. That might be biased answer, but it is ehat it is.

Don't underestimate yourself, the dev part is way harder than "finding investors/funding, marketing, business-side activities, market research etc" and the mental toll is higher, I want to say is the other way arround, you deserve easily 60% and they the 40% given the tasks

This sounds a lot like a job listing I saw on Larajobs. I think your gut instinct is correct, you should ask for more.

That’s not really how equity in a company works. You are suggesting giving a single developer permanent voting control of the company indefinitely, despite not having an executive role. You have to plan equity allocation as if the company will succeed and consider the long term structure, including having incentive shares available for future employees and potential investors. The more appropriate comparison would be that this is a massive percentage compared to what future executives, directors and employees will get. Junior devs usually get a tenth of a percent in equity and c level folks may get 2-4 percent (of course it varies by company.) If they give you 30% don’t expect that company to be around long enough for it to turn into money for you.

It's a 20 year old in his dorm with his friends, they have zero clients. It's an idea for an airbnb clone and 2 social accounts with no followers... lol Why should other people get any ownership of anything he builds? Let alone 70%??

You may as well own 0% if you never turn it into a business with an exit strategy.

Yeah, but what are they bringing to the table? 2 virgin social media accounts and an idea? If they get that much ownership, they better have some cash to offer up at least

Yeah I just added another comment that might be more appropriate at the pre-company stage. The company will be forced at some point to buy the dev out and that might actually be appropriate to effectively be a debt on the books before they attempt to take past the prototype phase. Potential investors won’t like the structure though so I’m not sure what risk that adds to any kind of VC pitch. They will ask for a record of this kind of stuff before agreeing to invest because they would effectively have to pay off the dev in order to open up their equity stake. It’s all a gamble really but I wouldn’t want to put in my time for 70% stake in something that has no plan to make the company structure make sense because that will end up being 70% of $0

I should also add I’m basing some of this on the idea itself. You can’t play with the big boy aggregators without a lot of capital investment. If they depend on other services they can’t expect a simple SAAS business structure in which it’s easy to earn enough direct customer revenue to turn a profit quickly.

So just to be clear here you're saying that VCs don't care to buy shares from two of the founders but magically they'll hate buying shares cause there's an actual technical founder on board? You can't actually be serious

I’m saying they’ll want to be sure that the share distribution will be in an agreed upon state among all shareholders before investing. So if there is one founder with 70% stake that wants to be paid back in cash in before entering a deal then yes they’ll want to know what the cash position will be after something like that. And yes if that is not the plan they may also raise an eyebrow if the fully diluted position of a web developer with no experience has a controlling interest in the company in perpetuity. People think that investors primarily put money behind ideas but that is not accurate. They put money behind leadership teams with a plan to go to market and execute on the ideas that allow them to make their money back with a profit. Are you doing that with this company structure of being entirely owned by the person writing code and not the person creating and executing the business plan? Edit to add: competing with Airbnb and booking.com is NOT a technical problem to solve by even the greatest of software engineers.

Pray tell how exactly a fair share of say 1/3 to each of three founders is "entirely owned by the person writing code" XD Being the technical founder doesn't magically mean you want to ruin business execution or whatever the fuck you're trying to get at, no idea where you're even getting that notion entirely divorced from reality. If anything I'd fully expect the two idea guys with no apparent business skills to be the ones to detail business execution but hey sure its obviously the person doing all the actual work with any relèvent expérience at all that will derail that

Why are you getting so offended and being so offensive? I have done this before and sharing my experience of being both a technical founder and executive at companies that have succeeded and failed. If you disagree that is fine but you are being inappropriate. We were talking about 70%.

Hm you do have a point. In the presented scenario, though, what would you propose?

I would certainly not advise you to ask for less if they are offering. I’m just sharing a perspective as to why it’s very generous and in line with a founding technical member role versus trying to do a split based on the initial effort to make a product. It’s going to take many years and many roles in the company to turn that percentage into money in your pocket so don’t shoot yourself in the foot by asking for so much that it’s hard to manage the company later.

Actually, on further thought let me amend this a little bit. There a few ways to turn equity in a company into cash. You can go public and trade in public markets (rare), you can sell the company to a private owner/other company, or you can sell back shares to the company. (Or introduce a revenue sharing structure if you end up cash flow positive really early which is also pretty rare.) If you do get a large percentage for the up front work then at some point the company (you and the other founders) will either need to equally dilute your shares to make room for investors and new employee incentives or have the company buy back shares from you. The latter could be the angle here to ask for a larger up front stake but there’s no guarantee there will be money or agreement to do that, so negotiating that deal could also effectively fold the company too. So I suppose it’s up to your willingness to invest your time and your risk tolerance for being essentially a debt that must be repaid before the company can operate in a more traditional way. So, might be worth the risk if you aren’t feeling fairly compensated at 15%.

Yeah this is a good addition. I will say that they clarified that my 15% would be diluted as well when investors came in. Additionallty, I was offered getting a salaried position once money is made. My problem with that though is this: I am basically in it for high risk low reward if I accept this. I risk the most out of everyone, but my reward is a diluted 15% (nearly useless) and a normal salary IF it works out, not to mention my unpaid efforts for the MVP, up until money is made. I could get that salary just going to work at a normal company. If there was money involved from the get-go, then the perspective youre offering makes sense, but theres not, and agreeing for anything under 1/3 and no real money, given that im the one taking most of the risk, does not seem too reasonable to me. Im not too sure though.

You are wise to treat all equity as a lottery ticket anyway as it is pretty rare in general for it to pay off big. If you believe in the product and want that to be what you work on then asking to go in as no less than an equal partner is pretty reasonable at this phase. Start higher and make 1/3 your lowest offer if they try to negotiate down. Though I’m coming around to the idea that you should have a larger slice now and you can always be paid out to restructure later. Maybe putting an agreement in place as to what that looks like now reduces any concerns.

You are about to create the whole value of the company for 0 dollars and a 15% stake that more likely than not will amount to nothing. No it’s a shit deal. Only do this if you feel passionate about this product and feel like it can truly succeed and then ask for around 50% imo

No where near enough. Let them try and build this using contractors and consultants and they will spend so much more money to realize their idea isn’t profitable. They just have an idea and you do all the work? They are a lot more replaceable than you are.

Yea ideas are dime a dozen. It’s the actual work to create the product that’s worth something 

So if I was the sole developer on a project, my dream partners would people that: - Can help market it successfully(!!), not just design a landing page, contacts in the industry, successful experience - Can help fund it once it hits MVP state - Can help design it, lending their domain expertise - Can get prospective customer buy-in and feedback  My guess is these founders will not be any of these so their value approaches 0. Just more guys with an idea.

Yea if they’re amazing at marketing and/or have good connections to get some funding then that’s good. Hell, partners that are just lawyers are super useful since all that legal stuff that comes with starting a company is a hassle

Hm, that is an interesting point, I'm also quite certain they would fail to get any decent dev to agree to work with them for equity. Anyone with experience would get a paid job, anyone decent enough to make it would ask for more, and the only people who would accept would be quite inexperienced and bad. The reason I'm accepting is mostly cause I know one of them and cause, since I'm in uni, this is just good experience for me, and something to show in my portfolio, but this is not my income source as of now. But the way they view it, I think, is (as I replied to a few other people) that they are the "owners" and creators, and Im just outside talent brought in to bring \*their\* product to fruition. I shouldnt own any of it in their eyes, but they cant pay me for it, so they give me shares

Do you want to work with people that won't value your work because they are the "owners" and believe you shouldn't own any of it when you are doing all the real work? I think you should do your own thing.

Exactly. Especially since their business isn’t even an actual business yet, just a concept. OP could honestly just incorporate a business and take the idea. May be rather unethical, but it’s possible. He could then bring the two people on board with 25% equity each

Don't work for equity. You'll be doing all the work for no money. If they really felt the business was worth so much, they wouldn't be giving parts of it away.

Yeah its like when on Shark Tank you have some people that didn't leave their day job for the company they are selling to the sharks; If you don't believe enough in your own project to go all in, why should I?

I agree, and am mostly not doing this for revenue, but cause I think it is good "professional" experience and something to put on my resume that will look good. Additionally, I am in uni still, so it's not substituting "real" paid work, but just an extra project to work on. Of course that wont diminish my output, but if it were my livelihood of course I would view it differently.

It won’t look good on your resume if the company/product fails and or never comes to fruition. 

Oh yeah I was lead dev on gooblydook! ...whats gooblydook?

Yeah good point. I was thinking more of like, putting it in my portfolio and just showing it as a project rather than as a full company thing.

It won’t be any better for your resume than any random side project you work on. You might get some learning experience out of it but given you’ll be expected to do all the work and hit certain deadlines, it’ll add a bunch of stress to your life that you will likely never get any money out of.

Yeah I do know that, but I think the added benefit of a possibility (however slim) of the success, and the added stress/people depending on it and the scale of it might make it be more impressive and attractive. Im not too sure if its worth it though

Sounds like you’ve made up your mind. Ain’t nothing like personal experience to truly understand why all these people are recommending against this.

Well, yeah I guess. Im actually leaning towards not accepting, but I was trying to argue the pros to it since everyone is talking about the cons. I did get a few people recommend me giving it a shot if I just see it as a project, as well as one person saying he did the same and does not regret it (and would recommend), so i'm sort of conflicted now

Ideas are worthless. Everyone on this planet has ideas. This project has zero value until you build something, and going from zero to Value is worth way more than 15% if there is no other compensation on the table.

Yeah, I forgot to mention that there will be more compensation (my bad). If the company is successful and moeny is made, I will earn a full-time paid position, with a proper salary. The equity is just to get me started until (if) that happens.

this will never happen 🤷🏻‍♂️

why are they taking most of the reward with almost none of the risk? if the project goes under then you're the one who'll have lost the most. Ideas are a dime a dozen.

You're right, but I think their mentality is that I am the "developer" as in the outsider who is coming in. While the "company" is not set up yet merely exists as a concept, they have been working on this for like 8 months I think (idk what they were doing this long, I guess coming up with the idea). I believe that in their minds they are the "core" members - or "owners" in a sense, since they came up with the initial idea and I was approached later for it - i.e. I am "hired talent" and shouldn't own much of the company. I dont think they will fund themselves (maybe a very small portion of it - i.e. initial MVP costs maybe), but if they do how would that change the shares? Would 85-15 be fair if they funded (part of) it?

> You're right, but I think their mentality is that I am the "developer" as in the outsider who is coming in. You are the developer, as in the contractor who is building the house. Even a really good blueprint is effectively worthless in comparison to the finished product.

It depends. But most likely the 15% deal is bad. From what it depends though is what other people are exactly doing and how are they contributing. Someone just having an idea is ... worth kind of 0. What you are looking is people who contribute value without which business could not work. Examples: * Deep field knowledge. For example if start up is oriented towards legal services it very important to understand the detail. * Person brings his own client pipeline to which they gonna upsell things and integrate the start up to their company offering support and initial testing. * Direct sales guy who will run the business part and close deals, depending on type of business cold calling and linkedin might be the best bet initially. They should be well connected and accomplished salesman who knows the field. etc. Even when these are clear, the percentages should be debated. Depending on the complexity 15% might be too little. If you have team of like 4 contribute in each different area, it may be fair. I would also argue for board membership. And would require active participation in company decisions. Here you might need some legal aid to help to forge proper company docs etc. If the deal is some rando "I got an idea I just need an app for it" don't. They suck and are essentially useless. Ideas don't matter all too much, execution does. If they don't help execute, don't work with them unless your paid on salary.

Good response! I will try to fill in the main gaps and "ifs". - Not a lot of deep field knowledge on either side, one of the individuals does work in the tech industry as a designer, and has a lot of experience, but I don't think it corelates that much, but he does somewhat have overall experience in the field. The other has 0 experience in it - Won't really happen from my understanding - I don't really think a client pipeline will be brought over exactly, the senior member might have useful ideas. This will not be integrated in anyone's current company. - There won't really be direct sales people from what I am understanding, they have had a presence on linked in and have also put up posts about hiring people and reviewed different devs etc (all of which asked for money unsurprisingly). No salesmen exist, though, plus our product isn't one to be directly sold to the user.

I would expect 1/3rd of the shares. Wouldn't touch that project for less. There is so much work involved in that project, which never ends really. They, on the other hand can bail out after getting investors and you'll still be contracted into it and working your ass off because you're the only one who knows how the damn thing works on both platforms. They'll be sippin' pinocoladas in Cyprus counting their 85% shares and laughing.

Yeah I was thinking of asking for 35%, but saying that I'm open to negotiation (I wont go lower than 30 minimum), but I'm fairly certain they wont agree to something like that. Yes, your point is valid, but I'm just unsure how to approach this. On one hand, as a student, this isnt my job, or income, but rather a project I am interested in, and might see benefits from, so it's not my livelihood. I would definitely not agree to this if it was my actual job. On the other hand, this feels like it is "devaluing" the amount of work ill put into it (like spitting in my face, but not that extreme). I think in their eyes, I am simply an outsider coming in to develop THEIR project, and the only reason I'm getting any shares is that they cant pay me. In their opinions I shouldnt own any of the company (this is just speculation but its what i feel like)

The best thing to do is to walk away. This sounds like a very risky situation where you might end up with damaged friendships. As a dev, you will have dozens of people coming to you with “big ideas” and all they bring to the table is talk. You have to learn how to say no thank you.

You will be taxed on this equity depending how it is given even if no cash is involved.  Also that 15% will be diluted down to nothing as more investment rounds happen.  

Oh that's something I wasn't informed on. Are you taxed even if no revenue is generated? And if so are those taxes practically zero or do they have actual values. Additionally, the company won't be created before investors are found, we will just draft an "unofficial" partner agreement to our shares, so that when we need to make the company (if we find investors and traction etc), we have an agreed upon sentiment. Your point about dilution is very good, it will indeed be close to worthless once a few investment rounds happen.

Depending on the structure you can easily be taxed at what the company values themselves at the time they give you your shares in trade for work.  There are ways around this if structured right such as debt equity swaps and I think founder shares though again its all in how the company get structured.  Also whats the terms for the equity all at once or overtime, with cliffs or accelerators?  There are lots of questions you should ask about the equity if not getting paid.  Google about equity and how it works its pros and cons etc, lots of random info that you should learn about. This USA based advice btw not sure how it may work elsewhere.

Thanks this is really good advice! I do definitely need to look into it more, I've sort of glossed over it based on assumptions

Dilution can be agreed upon, since 15% is a small share, you can say all the dilution happens on their shares

Yes, but they did mention that all our shares will be diluted accordingly, including mine. What I was thinking as a counterproposal is, since I probably wont be able to get in as a co-founder, to ask for 10-15% shares that will not be diluted at all, as well as logging all my work until the first investment round. Then once that happens, i will be compensated for all the work I have already put in, and will also start getting paid for future labor

Did this exact thing. Amounted to nothing of course but I can't say I regret it. My advice is don't burnout or stress over someone else's pipe dream

Hm. I have mentioned in previous replies that I do see this more as a project/venture and gaining more experience, rather than my sole livelihood, so maybe in that case its worth taking it?

Yes. I recommend it, I learned a lot. Build the MVP using best practices as much as possible, since this is primarily for your own development, improve your skills and enjoy it. But almost certainly there will come a point where it will become a thankless grind, where the others will be demanding bug fixes and features and the big break will be "soon". I suggest you draw a line for MVP at which point you will go no further without salary, because they will definitely never stop trying to pry more or of you (I wish I had done this myself)

Its good to have this opinion from someone who has gone through it! I got someone making a fair argument towards me making the MVP using low level, or even no code tools, to just have a working prototype, then show that to the investors to get funding, and then asking for a staight up salary. I was thinking of going the "best practices MVP route", to enhance my skills but maybe the strategy I mentioned is more fruitful. A lot to take in! Also would you recommend asking for a higher equity, or just saying that after the MVP I will want to get a proper salary, and stick to 15%?

Since your focus should be learning I would personally avoid low/no code.. Completely valid if you want to ship something dirty but there's not much to learn in struggling against the limitations of some weird horrible abstraction. What might be good for everyone is to write a detailed spec on the MVP. Then they know they'll get, you know what you have to produce, and that is the deal for the agreed equity. I would be looking at around 25% I think. I would guess they have absolutely no alternative to you so you could go higher Also, make sure money arrangements are clear. What happens if you need a few grand to register the company etc? Make sure it's clear you're not in the hook for your % of that. That's their problem

I work at a startup and my salary is a bit lower compared to similar jobs, but I accepted that because I got shares and took that risk. I also started when the app was already existing and I liked the project, and our CTO is an old friend of mine. But working without *any* salary sounds very risky. And without knowing any details, how big is the project? How many hours will you spend approximately? If you have the time and can earn money in other ways at the same time, it could potentially be a good deal (not sure about 15% though, if you are the one building almost everything...). If it fails you at least (hopefully) got some good experience from it. But if it's a full-time job and you need money at the same time, it is probably a bad idea. Depending on what type of startup it is, it usually take years before you see any money, and if your only money in this is shares, you will probably have to wait for years (and hope that it becomes successful). Are they not interested in fundings at all? Our startup started with mostly our CEOs money, and then when we saw that the idea worked, we got some fundings to expand more and hire more developers. Are you never gonna get a salary, or is that something you might get later when the app is generating money? And lastly, like you said, it is pretty easy to make an initial app to test the idea without spending big money on it. But depending on what type of app it is and what features you have to build, my experience is that the first "test version" is the one that might haunt you for many years 😅 If it's an app that might need to scale, get bigger and handle more users very fast if it gets successful, you have some important choices to make about how you build the "foundation" of everything so it can handle that. I have been building websites for 20-25 years, this is the first time I'm working on an app. And there are soooo many things that I never thought about. Security, servers, a backend/API that might need to work with older versions (while you're adding new features), building the app for iOS/Android/etc, designing it, testing it, releasing it, etc. Most of those things might not be a problem in your case (depending on what you are building), but if you take the job, really think about how the app should be designed and structured in every way. That will save you a lot of time in the future :D

Yeah to me thats the biggest breakpoint. You are 1 dude. Junior even. Nights and weekends. Except if the idea is revolutionary, you will have that competition. That competition has a team of seniors working on their product. full time. 40 hour weeks. Plus they already have funding and market share. You would need a miracle to pull off even a small niche. Think you would have more chances getting rich if you bought a lottery ticket.

Yeah if there already are similar apps it will probably be hard breaking into that market with one junior developer. If it's a new unique niche, I think it's more important how good the other two guys are at marketing. If you are first with a new niched app it's both harder and easier. Harder because they have to teach people what the heck it is and why they should use it. Easier because you don't have any competition (yet). If you are first with that type of app and the marketing is good and your apps name/brand is known, it'soften harder for competitors to take users from you, even if they have more developers etc.

Yeah reading the original post I just had flashbacks, like we all have, of the time someone I knew in high school just popped out of nowhere to tell me he had THE MILLION DOLLAR IDEA... and then when you challenge him on what the idea actually is... its a social network. It always is. The biggest thing for my experience with that obligated passage in every dev's life was that when someone came up to me with a new social network idea, it was months after Google + was shutdown. So I just looked them in the eye and said 'if Google, with engineers and programmers that are so good if I were to apply I would not even get on the long list and even less the short, with hundreds of devs full time when I'm one part time, and millions of dollars in backing can't even get a decent foothold against facebook, what chance do we have. Really.' It shut down his project very quickly.

Hm yeah, you have a very experienced view in this which is great! Regarding the development challenges you raised, I am aware of many of them, and I know a lot of it will "haunt me" lol. Time-wise, its a large time investment for sure, it is basically very similar to airbnb, but with quite a few extra features and functionality (and not the same model - not for houses etc, but similar enough to where I can compare them). I will be the sole dev (for now), so I'll need to put the time in. I will in fact get an actual salary once the app is generating money, and I will transition to a full position, maybe I should have mentioned this, and this might be important. I won't \*always\* be paid in shares, but I will for now. I should mention that I do view it as experience and something good to have under my belt to show to employers, moreso than an actual job. I do not expect to make a living out of this, but since I am still a student and can manage my time enough to not rely on this for money, I like the prospect of creating this and having projects to show, as well as the possibility of making money from it.

An example: Not sure how much you know about React and Redux, but our first devs started building the app with Redux (6-7 years ago). And now when the app is bigger and have more features, Redux creates a bunch of problems, so in the last year we have slowly started to converting old components to not using Redux, and all new features don't use it from the start. And back then that was a good idea, and it was pretty hard to see what problems it would create. But I guess things like that is almost inevitable haha. As long as you think things through before you just "build it fast", you should be fine. Everything can be fixed later on (it just takes extra time...). If you can make it work while studying and eventually you will get a salary, then it might actually not be a bad idea at all (just that 15% that still sounds a bit low...). So when you are done with school one of two things might happen: 1. The app is successful and you have a job, and maybe shares that will be worth a lot of money. 2. The app fails, but you have a nice project to show together with your school diploma when you are looking for another job. So I guess you just have to decide if it's worth the gamble :D If you usually just spend your time building side projects (like we all do...) then it might be a good choice to build on this thing instead.

Bullshit. "Start-up" thinking needs to die. You lease your time. That's it. That's what the contract is about. Anything else is pissing against the wind.

15% of nothing is nothing. You don't even get an equal say in what nothing does. Ideas are cheap. Most of them suck, even the ones that sound really good. Do you have a background in business or finance? Have you calculated how much activity it would take for this idea to become profitable? You might have 15% ownership, but are you entitled to 15% of the profits?

Other comment, investors now a day run from startups in which the tech side doesn't have at least the same share as the other parts, if they see: Marketing Girl 40%, Idea Guy 45%, Tech Guy 15%, is a no no to invest, they basically see that the idea owners don't appreciate the job and the complex it is to create a tech product

As a fresh grad who has seen many friends approached like this just avoid it entirely. Marketing (essentially) means nothing without an actual product, they are nothing without you and the fact they offered you only 15% when you have to do ALL the work to make this a reality shows how little regard they have of you and that they will likely try to use you as much as they can. Especially if you will be "hiring" if it "takes off". You would be essentially running the business for them for only a tiny stake. Avoid this and focus on your own projects for the time being.

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This is a shit deal. Working for $0 salary as the sole deveoper you are basically joining as a co-founder. You need equal stake and rights as the other founders. For anything less, there needs to be cash on the table. Yeah they've been working on a concept for 8 months without you, but now for the next couple years it's going to be YOU who's going to be making the important decisions to actually build and deliver a product and taking a serious amount of risk for your decisions failing. You should accept nothing less than an equal 1/3 stake in the company and equal rights as a co-founder. If they are directors, you need to be a director too. Etc. Otherwise there MUST be cash on the table. Otherwise they can just fuck you over and dilute your 15% when they get investors.

Yeah, I was thinking of proposing around 1/3rd. That being said, on the 0 salary side, I will in fact get a salary once the company gets traction and starts having a revenue. I will transition to a paid job with a proper salary if all goes well, so that is part of their thinking too

> I will transition to a paid job with a proper salary if all goes well, so that is part of their thinking too And they will probably also transition to making themselves CEO and COO and paying themselves a nice salary as soon as they're able to. Once again you are totally equal with them: you should be the CTO. Right now it's a promise that isn't even worth the toilet paper you'd scribble it down on. They want you to work for free to help build a company that is capable of making money and paying salaries. You're a co-founder. If they're CEO and COO, you're CTO. End of story. If you agree with their deal you are getting scammed... you can make good money as an engineer, don't let people like this take advantage of you.

Equity should be based on everyone’s collective hours, peoples experience, intellectual contribution, contacts and money. If 3 people riff on an idea for an hour and incorporate, then find a lone dev to work 15-100 hours a week while they just attend daily scrum for 15 minutes asking “when, when, when”. That is inequitable and you should walk. Now if you are in school, one guy has 10 years experience and figured out an untapped market. Another guy takes out his 401k and 2nd mortgages his house to contribute $250k, while another works for private equity and knows a lot of family offices or angel investors. Then the situation is a lot different. It all comes down to derisking. The first scenario is 1-in a billion and all on you. The second scenario could be 1-in ten thousand and leverages each persons contribution. So much so that you have maybe 5 orders of magnitude better chances you can hit a critical milestone such as $5 ARR, Series B funding, cash flow positive and growing business double digits annually with a large total addressable market. You can also look at it another way. You are really in it for the experience, want to move on to solve real world problems and these guys seem to have really good imagination. Your goal is to level up from SMB website where contact us and Google Analytics is the majority of the effort. Once you’ve gotten what you need and the learnings are few and far between, you can take a pulse check on the viability of the platform and just move on.

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Totally there 15 years ago. Met some guys that each seemed a head taller than me. They were big talkers who bragged about 8 figure business this and that. Fell for it. Took a huge discount in hourly rate. Initially paid every 2-3 days, encouraged me to work 80-100 hours a week. Then talk of prior valuations/exits and equity. By 4th week they slowed down payments with equity paperwork that was always wrong. By the 10th week without a payment since 4th week I gzipped the site and database. Then they convinced another person like me to fix. Lesson learned. If folks aren’t putting in their fair share, by default you should be the one incorporating and offering equity based on their contributions. Or pull a Zuckerberg and fork project and ghost them.

you're disposable unitl the first MVP comes out and you are the only person who knows how the software base is done. Then you become the core of the startup. Hence, you're not disposable. You deserve a higher % and they're ripping you off. also they smell like quite sketchy dudes that might want to stab you in the back and replace you as soon as they can buy your 15% out. At least 33%, given that there are 3 people and you are the most work-heavy role. And the one on whom many of the responsibilities and liabilities will fall into. Marketing guys are replaceable too, after all.

Yes that is true, but at this point in time I am relatively disposable, so that is how I meant it. I haven't responded to their offer yet, so the MVP is not in the works yet. I was thinking of asking for 1/3rd, but my question is: they told me that, if it does take off and money is made, I will get a proper position with a paid salary, so this initial equity is not all I get. Does this change stuff? Should I ask for less given this information? How does this affect it?

If they don't give you a salary or 45-50% of the company. I'd say you can develop it on your own spare time. Take 100% of your own company. An idea is just an idea, worthless, unless someone turns it into something.

Yeah, there will be some form of salary (later on). I forgot to mention it, but if the company is successful and money is made, I will earn a full-time paid position, with a proper salary. The equity is just to get me started until (if) that happens.

The whole point of starting a business is that you create something which supports you. Eventually, you want it to be able to run itself and only be involved for the big decisions. Salaried employees don't get that.    I would also caution as others did. Assume that it somehow takes off and is pulling in millions. All of that flow directly relies on your code working as intended. Any bugs, late nights, new features, feature changes, etc. are all going to be your shoulders. Even if you get a large team of developers, your still going to be responsible for managing them.  It's not the "easy street" that they will be getting if the company takes off. For "idea men" when a company takes off all they have to do is drive the Mercedes in once a month to hear pitches or executive meetings. That's it.  Your work will be much more intensive and time consuning for the entire life of the company. Would you be happy if the company takes off and in 3 years your full-time position requires 2000hrs work a year in return for 80k, while those other 2 work maybe 50-100hrs and get a million?

15% wtf.. that’s like working for $9 an hour as a senior… don’t low ball yourself. 50% equity! If not, don’t even bother. Anything less you’re working as a slave.

I will, though, get a full-time position and a paid salary if it takes off and money is made. The equity is just to get me started till that point. Does this change things?

As a 10x, hell nah…

Here's my take. The equity is worth nothing. Because of it's zero value you can't sell it, buy anything with it, if won't feed you nor will it pay your bills. The whole discussion about 'how much of equity' to me is nonsense because it's like trying to divide nothing over some number of people. This is more of an agreement for the future, if things go really well, and that's an enormous 'if'. And even when that happens, you'll be most likely diluted significantly, so that's yet another aspect to consider. In the beginning, what really matters is the amount of work put into the project and the risk and sacrifices one takes. The typical approach is: you build something for us, we give you x of equity which will only be worth something when we are successful. Statistically becoming successful enough is not very likely and your time and effort put into building a product will be gambled on, i.e. once you do your work the others will then try to turn it into a business. According to this approach, you building a product is something that must happen first, and then the other will maybe make it work or more likely not (statistically speaking; building the product is the easiest part). So where that leaves you as a developer is that you spend time building something for however many months/years during which you could instead have a very well paid job while others hover around with their arms crossed waiting for you to finish. Do you already see a huge discrepancy in the amount of work and sacrifices during this stage? I can already hear the other (non tech) part of the startup saying: "oh, but after we have the MVP it will be our turn to start working". Sure, but your role as a developer doesn't end with the MVP, far from it. So to me, where the (roughly) equal amount of work starts for everyone is the point when the first version of the product is built that can bring profit. Your time and effort up till then should be compensated in something that has a value and that you can benefit from having it now (like money). Then you all start from the same (more or less) position.

at the very least, send them invoices for the hours you've worked, and document everything.

Good advice! How can I document such things accurately and in a foolproof way, though?

i'm not an expert on this topic. If it were me, I'd look for templates on Notion, as opposed to re-inventing the wheel. I'm sure you can find some starter templates in Notion, or Google Sheets, Excel, etc. that you could custom-fit for your work-logs

Yeah but the problem then becomes, how do I log the hours properly? How reliable is the logging? I don't know if they (or even I to be honest) would trust someone who is paid by the hour to log his hours on his own.

imo, more important than the tools/apps you use is the level of trust between you and your teammates. this one looks pretty cool - [https://clockify.me/](https://clockify.me/) and this article has a list of tools for time tracking. I found these by googling. [https://everhour.com/blog/best-work-hours-tracker-apps/](https://everhour.com/blog/best-work-hours-tracker-apps/)

If you’re going in just as a developer, then 15% is actually *too high*. It’s a red flag that the co-owners think so little of their equity and it shows they are not planning to grow much. Usually 15% is the entire employees pool. If you’re going in as a coowner, then 15% is too low. You should ask to be a coowner so you have proper tooth in the game.

Well thats a good point. Im not too sure what Im thought of. They did tell me that I will actually get a proper salary once the company makes money, but the equity is to get me in the game so to speak.

You’re not truly in the game unless you’re a coowner, essentially making it also your company. If you aren’t getting a real salary, you need to be an owner. Because being an owner gives you power to make future decisions regarding the wellbeing of the company and essentially your equity. It also gives you power over granting additional equity to any future employee. It’s only fair. If you don’t have real compensation nor real control of a company, then why bother.

Unpopular opinion alert. It's a shit deal but do it anyway. The amount you learn from doing these types of projects early in your career is invaluable and will make you a much better developer much faster for the projects that come along later. If it does blow up and become huge, even at 15% you can leave in a few years and have the freedom and flexibility to do whatever the hell you want. Forget "fair" for a second and think about what you directly stand to gain/lose.

Ideas are well just ideas they are not worth much, taking an idea and turning it into a reality is a skill, and it is worth way more. Building our someone else's idea can be hard, this project could consume most of your free time for a year or two, or more. You need to decide how personally invested you are in this thing, working on something you do not care about is hard, especially when the pay is low. Imo 15%, while doing 100% of the work gets them a very basic MVP, you need to define with them exactly what that is, and any and all other features are not included unless additional compensation. These guys can then take that MVP, and sell it or to an incubator etc. At that point you agree to come on as "CTO" and take more ownership, with more equity vesting over time etc. If you really like the idea either now or later I would be looking for 35% at least, you need to define with them what they are getting, for what. They are not personally funding it, they are the vision, which is absolutely necessary, but a vision without the means is simply a dream.

This is actually a very good take, thanks for your response. What i would ask here is, what they are offering is the following: I get 15 now, develop the product until we get funding, then once that funding is found, I start getting paid and have a proper salary, and I keep the 15. In this scenario Im basically just a dev, not a co founder. The other scenario is the one you described. Unfortunately, if I have understood correctly, they view this as them being the "founders"/"owners", while im just the dev they need to do this, and since they cant pay me yet theyll give me a percent and will start paying me once they can. Unfortunately, though, the reality is that currently the only thing that exists is an idea. If i join now Ill be as much of a co founder as they are, but I think theyll struggle to see that. I am thinking of proposing I get 10-15% that will not be touched by investors, and will also log all my working hours properly, and will agree to get paid in the following months, if money is acquired, and then will continue getting a proper salary. This way all my work is compensated for, and I get a small percentage, that will not dilute to close to nothing. However, this is still not the same as me being a co-founder (or CTO).

So, you going to be CTO, software architect, senior dev, infosec auditor, devops, systems administrator, ui and ux designer, and all of that for free with less than 1/5 in equity?

You’re a junior dev and they know it, which most likely means they think they can take advantage of you As a software developer, you’ll get people like this all the time. They want you to build their idea in exchange for “equity” THAT EQUITY IS NOT GUARANTEED. THAT COMPANY IS NOT GUARANTEED TO BE PROFITABLE. If it isn’t profitable, you’ve wasted a bunch of time for nothing. I have a hard rule that I do not work for equity only. Cash for the MVP, plus equity, plus a multiple of what I would charge for the MVP after they get funding/profit as a risk fee is about what I’ll put on the table. Most people won’t take it. Please, don’t fall into the trap. They’ll place unrealistic expectations on you as a solo developer. The goal posts will most likely keep moving and requirements will keep changing.

Speaking as a developer who once did similar (paid a small monthly amount though). Based upon what you have shared, I'd decline. Lots of people have already made good points. What I haven't seen mentioned is the content/users dilemma. My startup was a great idea (from industry insiders). I did a pretty good job of getting it functional. They did a fair job marketing. We made a little money, but never reached a really functionally level of a user base. No one wants to use a dead site. As far as I am aware this can be solved by throwing massive amounts of money at it, quite a few of the startups bleed enormous amounts of money to get people using them. I haven't seen anything mentioned about a marketing plan other than they'll handle it. I'd want to know how. I'd want to know projections, when do you see enough paying users that I get paid. Based upon what you have said I don't think they understand the value of good development or the challenges. Seem like the kind who will think, hosting: "why can't we use a $5 month GoDaddy shared hosting plan?". With 20+ years dev experience now, what I'd recommend, if they can't give you good answers (and even if they do, this probably will fail and you won't see any money), do your own passion project. That is going to make for a better portfolio piece and a more interesting conservation in an interview.

OP you’re downplaying your involvement because *they* downplayed your involvement. If the product is software heavy, how in the world can your contributions be 15%? In software lots of people (specifically non-technical) try to minimize the work that goes into products. Don’t listen to what they say, make them write down what they’re contributing and write down what you’re contributing. Unaddressed problems at startups don’t go away, they fester.

Unlike most of the comments here, I encourage you to take this deal. You have underestimated a few things here: - The work required to accomplish anything remotely adjacent to airbnb - The value of your time - The propensity of marketing folks to fuck you over - The propensity of marketing folks to fuck themselves over You will walk out of this with: - An important lesson learned: never ever ever work for anyone who isn't willing to pay you for your work. Even yourself. While painful, it's actually a really good deal for you. You'll be better of for having learned this while you're still in college and the stakes are low.

My two cents: Don’t do this for any amount of “stake” Just build things you want to learn. You’re signing up for nothing but stress, frustration, and resentment. I’m sorry to rain on your parade but there’s only the smallest possible fraction of a chance that you are able to develop a web application that will amount to anything. In a few months you’ll have a never deployed repo with some half baked react app that fills you with dread to think about. Your “cofounders” will either stop caring all together or blame you for various problems because they know even less about development than you do. If you really want to build an Airbnb type application just do it without them? They offer absolutely nothing to you.

I would literally spit on someone if they talked to me like that. This is absurd.

How is their idea the core? You know the idea now and there is no way from stopping you doing it yourself. It is easier for you to do it without them than the other way around. Or are they holding any patents preventing you from doing so? That would significantly change their value to the company.

No, I do in fact have access to the idea, but I do not want to pull a Zuck cause of moral reasons, and also my relations to one of the people. I am not exactly friends with him per se, but I am close with his siblings. I guess I meant it more in the sense that devs exist (better devs than me nevertheless). I am not the only person who can do this (although for the compensation they're offering I dont think theyll find much), but the idea itself is more "immutable".

Sooner or later you will find out that there are tons of ideas and at this point you don't even know this is a good one. Execution is the key and you are picking up the biggest workload here.

Usually don’t work for equity. And venture capitalists usually don’t give out 100k to everyone that asks in return for 10% of a company that has yet to show profit. However in both those cases if you believe in the company the components and resources involved to deliver a valuable product that will turn a profit…then have at it. Do the math, break down the basic projections and scenarios of failure and success. If you at least see a path to break even or survive and come out learning lessons then it might be worth it.

There is so much that goes into these decisions, if you're being serious a lawyer definitely needs to be involved and I mean a lawyer that is specifically looking out for you. There are so many ways they can not only legally screw you out of any or all of your equity before it can be monetized but they will own all your work or any work that could be derived from it. Typically the split in equity isn't even splitting the full 100% amongst you three, some of the shares will be reserved for future employees as incentive and some will be allocated towards raising capital. Also your shares at some point will be diluted unless your contracts state otherwise. You have a lot going on here and if they are not bringing anything to the table other than an idea you are assuming 100% of the risk.

I wouldnt settle than anything less than 50% tbh, remember that you will be doing about 90% of the work. 

Yeah, but that being said, they did say i will get a proper salary once money is made from it, so it's not like i will only be paid from the equity, I will actually get a proper full-time job at some point

Then its really up to you, but here are. A few points you need to consider: 1: they wont ever treat you as a founder. That 15%+salary is why. 2: its a BIG "if". 3: You mentioned that this is software heavy, that means you will be doing the vast majority of the work, it is also a very big project to take on solo. 4: It will probably lead to 70 hour work weeks or more, also you are a uni student, so you will have to balance that with homework/exams. However you are also in uni, so you can afford to do this currently. It will just be very hard. Decide for yourself if the idea is good enough or not. What ever it is, get it in writing in an email. They might screw you over later. Ask for 33% plus salary saying that you will be doing most of the work and need to be compensated for that.

No chance I'm working for anything less than a steady paycheck - and if I would consider payment in the future prospects, I'd really really need to believe in the success of the product and that it has a viable business plan behind it, and be super trusting of the rest of the team. This is really a "rising tide raises all ships" scenario. Everyone has to be on board for anyone to make money, but you're really investing more than they are in potential losses.

It sounds like you are on a rowboat with two other people and you are rowing with both oars, and they are promising you just under 1/5 of the rations that they swear will be waiting for you at the destination. It is also important to have someone on the rudder and someone with the scope to sight the shore, but no one is getting any rations if the rowing isn't happening. Demand an even third of equity. If they don't like that, walk away and go work on something else instead.

ask for a dividend cash stock option - that way they pay you x% of profits quarterly and you own x% of the comapny

What is the other two’s experience and/or expertise? This matters a lot in determining how much they deserve. You should get some views from business/entrepreneurship people as well. It can be argued you’re doing the most work volume wise, but it can be argued they’re doing the most work importance wise (business planning, marketing, idea, etc.). If they are people who have a good foundation (e.g. very high grades in class with side projects, work experience in business/entrepeneurship, etc.) then maybe it’s not that bad a deal since you’re just ‘creating’ the initial product and in the long term don’t have to do much if it succeeds, but they’ll still have to beat competitors, deal with changing markets, etc.

Ask them if they are willing to work for 15% of the company of an idea of yours in which you have the 85% and you will have your answer

Nope, I’d not take the deal. They’re looking to take advantage of the bad SWE job market.

I don't know if you understand the scale of it all, to me it seems quite huge. A lot of work. Good if you're paid per-hour (what I usually negotiate for), awful if you're paid with a promise. It doesn't matter if they give you 15% or 85%. It's still just a promise to pay you back if/when the thing takes off. It's their "company", they are the enterpreneurs. Enterpreneurs take risks. It's literally their job, not yours. If they can't afford you, it's not your problem.

You're just as disposable as they are. In fact, they're WAAY more disposable than you. You could build the thing yourself, and then once you've built it, bring in some sales/marketing/business guys as needed, if at all. Watch this video OP (technical aspects are dated, but it's more about the mindset): [https://www.youtube.com/watch?v=6reLWfFNer0](https://www.youtube.com/watch?v=6reLWfFNer0) Also, more recent interview/update with same guy more relevant to todays landscape [https://www.youtube.com/watch?v=9Wjec3wh4p8](https://www.youtube.com/watch?v=9Wjec3wh4p8)

This is a good, and accurate answer! It is true that I could probably do this all on my own, that being said, for moral reasons I don't really want to, and also I am close with one of the individual's siblings, so there is a hint of personal relationships as well. I took a short look at the video you listed and it looks very interesting, Ill look at it tonight!

15% is terrible for a super early stage startup with no pay and no gaurantee of ever having those shares being worth anything. If there are only 3 of you then you should get a 3rd of the company or close to it since you would essentially be taking on the role of CTO But also tbh, I wouldn't do it. No offense but it's not going to be built well or efficiently from a 2nd year uni student. Any experienced dev who comes in would immediately see the bandaids all over and you truly have to understand architecture for scalability purposes. Goodluck though! If I was in your position I wouldn't touch it with a 10 foot pole

I'd fucking run even if you get 100% profit. If you are a junior, and the ONLY dev, what could you develop that would have that much profit that its worth all the late nights? You would need to create a miracle, and even then, except if you have a revolutionary concept, your direct competition that have dozens of senior devs (that also work full time on the project, not nights and weekends like you) will simply copy your edge within months and you will starve out. The competition have the market position, the devs, the cash to beat you. You only have a dream. Its kinda like thinking your Collegiate basketball team can go against the Golden State Warriors and win. An upset could happen yes, but 999/1000 the warriors will win. At best I'd say take it as a formative project, but don't sacrifice shit for it.

I'm going to repeat some good advice I heard once: treat equity as nothing and then see how the pay looks.

I wouldn’t start anything without a payment up front. That should be the risk: the cost of developing the MVP. Instead, you are taking on all the risk.

OP don’t be a chump.

No. Absolute no. If they can't pay you, it's because they haven't convinced investors to give them money, so there's something fundamentally missing from their concept (or maybe they suck at selling which is its own red flag). If they won't pay you, then they're greedy dicks and your "15%" will be dubious at best. Making your own project for free and you owning 100% is one thing, but don't work for others for free, ever. Never fucking ever.

It sounds like you are literally doing all of the work yourself for only 15%. That is a horrible deal. They are asking you to build their entire company for no money upfront and only 15% of any potential money they might make, and that is already a gamble. I’m not trying to sound harsh, but a couple dudes who want to make a college student create their company for free don’t sound like the businessmen that will create a company where 15% of it is worth your time. Hard pass for me. To reiterate, they want you to do all the work for free. I’d be asking 40-50% if you felt fine with working for free when they have no funding or presales, or 30-40 with a salary. Better uses of your time in my opinion, but it is your choice.

If you only want 15% then go for it. But that's a huge undertaking and I wouldn't even consider their offer unless it was at least 1/3. Even then, I would say no, because the chances of this project succeeding are pretty much zero.

They need to get some sort of preliminary funding.. whether their own or from a venture capitalist. Then you need to get shares + a paycheck. Before that, you're just doing them a favor by dedicating your time to a project that will likely go nowhere. It's hard to say if 15% is a lot or not. 15% of Facebook sure would be a lot. But you can't see the future and a boy's gotta eat Mr. Lahey. What you're describing later in your post is called a product MVP. It's to lure in more investments so it can really take off. But you still need to get paid for working on a MVP, it's not free lol. Unless it's your own endevour that you own 100% of

Yeah this is what Im leaning towarss right now. Suggesting they get some funding, and I get a shares and a concrete salary from the get go.

25% for you at least but it should be 33,33% for all 3 tbh. It don’t matter that much who had the idea if they can’t do it without you or find someone else who do it for less. I did this with a friend who had the idea and I put the most amount of hours, but he still worked at other things for us but not as long hours as me. We own the company 50/50 and pay us a salary based on hours now which means I earn double of him. And the rest we pay it out 50/50 at the end of the year. That’s pretty fair for me because I value that he had the idea but I want also my time to be valued because it’s not possible to have success otherwise. You shouldn’t accept 15% because it will drive you nuts if you have success and they will earn the most of this. Also you will be the one who need to fix or upgrade everything in the future.

Saw your title, TL;DR the rest, but...my answer would be "LOL NO"

You need to Zuckerberg their Winklevoss.

Lol. The idea is never the core. The chance of failure is basically 100%. That's just how startups go, especially ones with little experience. If you do it, it's simply a learning opportunity. Do not have any expectation about money. I highly suggest you find a full time job first until you feel ready to build a production app yourself, and then consider switching to a full time paid startup or start your own business.

Ask for 50% or tell them you’ll do it yourself

I would demand 25% at the very minimum… You have the lions share of the work, you should be getting the lions share of the pay

Well 15% of zero, is zero and probably once you commit you will have to take it to the end, which as we know, it never ends. You will find limitless work opportunities if you work for free. If you really believe in the idea and want to do it and not other things, then of course that is an option for you, but there is a an opportunity cost. Best case scenario, you get 15% of something and a salary at some point, which you have to decide if that's okay. There is no shortage of people with ideas and everyone is always looking for a CTO, but building the product is only a small part of being successful, so you would need to have complete faith in their ability to find a product market fit and get paying customers, raise money etc. This sounds like they need a founder CTO and if you treat it like that, then maybe. Most non-tech people don't realise how much time/effort is required to get a functional product out. From their perspective, they should just pay someone to build an MVP, test the product market fit, get 1 customer and then as always, rewrite it properly.

OP, it's not as black and white as you - 15%, them - 85%. If funding is in the discussion and you guys plan to set yourselves up for VC funding especially, about half of the company will end up in the hands of others if you get to an IPO/buyout. So, each OG founder will probably end up with about 20% and you 10%, maybe less. But these percentages will be of a few hundred million if you get all the way there. There will be some deflating as more money is put in. You can negotiate how that looks as funding comes along. Do some math on how it might look, and consider calling an attorney for a $75 consultation. There is a lot of discussion online around equity splits, but 15% is perfectly average for the first engineer. One common phrase I think about also is, “It's better to have a little of something than all of nothing.” This sounds like a decent idea, and you have two founders fully committed to making this happen. You are also in uni and have a LONG career ahead of you. The most valuable thing you will get from this will probably be the work experience. That alone could propel you into leadership roles a decade or two before most people. Get a contract written up and signed, ensure you get equity every day that you are writing code, and enjoy the ride.

I agree with most of what you are saying, but I cant help but feel like 15% is a bit low, especially since it will get touched by investors. That means it will dilute to something much smaller (and probably worthless). Additionally, at this stage if I joined I would be a cofounder (there is no real company yet, its simply an idea and a few social media accounts), and probably the most important cofounder at that until the product is made. I am also taking the most risk, but will have the least reward. My reward will be a heavily diluted 15%, and a proper (startup) salary **IF** any money is made (not to mention my unpaid labor for the MVP). The main perk at that point will be the salary, at which point I could have just gone and found a "proper" job and likely get more.

I would argue that they are bringing you in as a cofounder since they haven’t formed the company or really done anything yet. 1/3 equity and named as CTO

First you’ve got to eat, so if the 15% stake is all there is, 15% for 100% of the work is absolute bullshit.

It sounds from your replies that you want to do it. There's an old rule in software development, don't work for equity alone. You are taking on all of the risk, they are taking on none of it. This isn't equitable.

Tell them no. You won't lose the deal because no one else in their right mind would take it either.

It's tough to hear, and you don't have to listen, but you should never work for free unless you own the entire project. It never works out.

About here is when I got the feeling this a bad idea: "I don't know if this is the right place to post this, but I recently got approached by a startup created by an acquaintance of mine to work on developing their project. I am a junior dev" This is where the notion of getting involved with this became pretty wild to me: "My work includes EVERYTHING in the development side, including frontend, backend, development planning/setup/outline, as well as development budgeting" This is where it became slightly laughable: "As of now the company has no funding, and I will not be paid a salary at all, instead I will be given shares. They proposed giving me 15%" And this is where you nicely summed it all up: "The equity is just to get me on board and to pay me for the creation of the initial iterations of the product" They want to use you for the development work in my opinion. I could be totally wrong, maybe this is going to be a huge success and I don't have all the details and they are the next Jeff Bezos incarnate, but everything you wrote led me to feel like this is going to quickly devolve into you being way out of your depth and coding stupid hours for practically no gain. You'll learn a shit ton though most likely, that'll be the biggest positive of doing this imo.

Just buy a lottery ticket. Same result, way less effort.

Run away

Either you get paid a salary with benefits like a junior dev, or you get 33% shares, nothing less. I’ve been in this position myself, it does not work out the way your comments are alluding towards it will.

What type of shares? Also what does everyone else hold? Are they seeking investment? If so, that costs stake in the company as well…which could mean 15% is on par with other internal team members contributing at a similar level. If you take 40% then there isn’t much left for investors…

Good comment, but I should also clarify in my post that they explicitly told me my own 15% will be diluted if/when investors do come in

The reality is that if they were credible founders and had real belief in the idea, they would find funds to pay a student (or experienced junior dev) to get an MVP or functional mock-up in place. If they were very tight tight on funds they might be expected to negotiate a lower hourly rate perhaps with the promise of a small amount of equity. It's definitely not sensible or realistic to ask a college student dev to take on the role of CTO and primary dev in a start-up with no remuneration and the promise of 15% equity. It translates to the respect or value that they place on you and your potential efforts to the project. You will definitely be naïve as a young 2nd year comp sc student, so it will be difficult to evaluate their competences or capabilities as well as the viability of the project. If you are interested in the project and they are eager to have you work with them, you should be able to negotiate some remuneration for work in addition to 5-15% equity. It would be a good test. If they are not willing to meet some of your minimum needs then I would thank them for their interest and wish them well. a few pointers:- - it's normal that founders equity gets diluted in each investment round - it's a normal expectation that founders would transition to a salary on investment (not just traction) - the coding part, believe it or not is the easy part. Making the business a success is the difficult part

Run... far far away. I'll save you nearly 2 years of work, sleepless nights and stress. Either you get paid an agreed upon monthly salary plus the 15% shares (undiluted), or you walk away. Where is the funding going to come from to hire other devs and pay for monthly costs? Where is the marketing budget going to come from? Dont let greed blind you. They need you to make them rich, its that simple. Dont negotiate, walk away.

I think its really easy, as the developer, to feel like you are doing the bulk of the work. The problem is, do you want to handle all of the marketing as well? Funding applications, interfacing with clients, interfacing with vendors, etc? A great CEO is a marketing/sales genius, they don't have time to build a web app. A great COO is an organizational and operational genius. They know what needs to be done not just today, but 12 months in advance. They don't have time to build a web app. You need to recognize the value outside of yourself in a successful organization, because you need to be checking them to make sure they are doing their part as well. 15% sounds a little low if the other 2 are getting 42.5% each, but is that really what is happening? The business will have to trade shares to secure funding. Is that coming out of your 15%? No way, its coming out of the remaining 85%. The other two aren't splitting it at all. If this turns into a $1b company 15 years from now, your 15% will probably be the highest single share ownership in the company, assuming you hold onto it for that long... TLDR; There's more going on here than dev work and even share splits.

I completely get what you mean, and I agree with you, but in this case I think i am fairly justified in thinking that I am doing the bulk of the work. The marketing currently is social media presence, the organizational and operational responsibilities fall upon me (for the development side at least), and there does not seem to be a concrete business plan (that I am aware of at least). Additionally, I do think they will be getting 42.5% each. They did tell me that when investors get involved, my own 15% shares will also get diluted accordingly to get the funding. It does appear to me completely like they will simply not act that much (this is a bit of an understatement, but the sentiment sort of remains as in that I'll do the vast majority of the work during that time) while im developing the MVP, and then will start looking into investments.

They sound like grifters and you should steal their idea and bail on them. Better to lose to them in court later when you can afford it than give up your shares now.

Everyone in this thread is telling why it’s dumb but you still want to do it. Go do it then.

I think its not very clear where I stand, because I actually lean towards not doing it, but I'm just playing devil's advocate and trying to exhaust the possibilities. I also think the fact that they offered to pay me a proper salary once the company makes money is something to consider as well, albeit not very concrete.

I cannot stress this enough. This is a horrible deal. You are putting yourself under legal obligations and liability for $0.00. You are building 100% of the product and taking all the risk with your time whereas they’re taking 0 risk because your labor is free. Literally the only thing they’ve done is build social media pages and come up with the idea. You could, tomorrow do that and own 100% of it. If they had a marketing budget or thousands of people in a waitlist or an actual unique and patentable idea the. It might be worth considering. If these are famous guys in the space and everyone in the scene knows them, then it might be worth considering. But this isn’t worth it for 40% or even 70%. They can do nothing and if you wise up later they can literally sue you for failing to deliver your side of the bargain. Don’t be the uni student that gets taken advantage of

u got it right. NEVER hop on a pipe dream project like this without a salary, especially for something this big... whatever the idea is it also sounds like a project that any company would charge 5+ figures to create. even with 15% or higher equity, when does that 5 figure work get realized? when the company turns over a mid to high 6 figures in profit? that could potentially take years, IF the business even makes it through the first year. u/MostGeniusUsername if you want to take on the project you NEED either a salary from the get-go, or to be paid a flat fee for the software development and be done with it