At least my impression is that none of this is malicious or intentional. And my co-founder graduated from an ivy league school and has a FAANG company on their resume as well.
Thanks for that perspective. We have tried to have conversations about it. But things improve only for a short while. I've even broached the topic of getting a 3rd co-founder to come in and be the CEO who can keep things running smoothly. That hasn't gone anywhere.
We also don't have a lot left in the bank (though we are trying to fundraise at the moment) and we do outsource some bits. Given how early we are, external help only goes so far - a lot of time it has just been a waste of money since the hourly contractors we work with aren't as invested and don't have the full picture the founders do.
Even though I don't quite agree with everything in your postmortem, I do want to thank you for reflecting and sharing your experience. It's not easy to admit mistakes in public and open yourself up for criticism. Cheers!
Great for whom? Founders? I just looked through the author's bio. It doesn't look like he's created an actual startup. What experience does he base this article on?
Why would they need to go woo institutional buyers? At 1T they're already probably part of S&P 500 and other standard investment indexes. All the mutual funds, ETFs, pension plans are bought into them.
Not necessarily. The FAANG stock prices are low right now due the overall market slump (except may be FB or NFLX). They will highly likely bounce back along with the rest of the market in a while. So getting a fat count of RSUs from a FAANG company at a bargain price (usually based on price on/around starting date) may likely have a huge payoff in a few years.
I mean, for all we know, those papers could have been cited as "look here's how not to do it or here's how we're different/better". There are positive and negative citations in papers.
> Are they asking you to choose between salary and equity?
Kind of yes. Market rate (I'm also FAANG) with less equity or vice-versa. The equity ceiling is at 10%. The way I'm thinking about it is that given the amount of risk at this early stage with no prototype, customers or revenue and the amount of work involved, the expected pay-off for the time and stress isn't quite transformational for me.
I don't believe in giving up work-life balance and cutting my pay in half for the "startup experience". I wouldn't go pay 100k+ tuition for a degree in "startups" - whatever that means.
What I've noticed when talking to non-tech co-founders that come with domain expertise/contacts or business chops is that they tend to figure that they can build an MVP and likely find product-market fit through a combination of founding engineers and contractors out in eastern europe. So they really don't want to give up equity. And later on bring in an external CTO to tidy up if necessary.
> Hold on - They are raising funding right now, but planning on bringing you in after fundraising?
That's right.
> Do you know how much equity they have? How big is this "founders pool" of equity?
They're saving approximately 7% for ESOP and proposing < 10% equity for me depending on my base salary with co-founder title and may be a board seat later.
I think I agree with what you're saying. It does feel like a regular post-funding early hire.