Tipping point with Cofounder. Is it him or me?
I have been working on a fin tech startup part time for the past year and a half and I am feeling like I am getting screwed over. Currently I have 10% of the equity that will be vested over 4 years with a one year cliff. As the technical founder I have built 90% of our MVP and released couple of additional features. The original founder runs the company full time and is in charge of all the biz development including sales and fundraising. He has 65% of the startup equity. We have some potential investors interested and if we get funds he wants me to quit my day job and come work on the startup full time, which I am fine with. My only stipulation was that I will need some sort of salary to pay my bills. I offered to take a significant pay cut to my current salary if I were to move to full time but he refuses to offer me one because he says the investors won’t allow a cofounder to take any type of salary. Personally I don’t think the risk is worth it for the amount of equity I have. He also won’t give me anymore equity if I do move to full time without a salary. He says if I want a salary I will have to give up all my equity and he will hire me as an employee to stay on because he needs me to continue to work on the product. I am not sure if it is him or me being unreasonable about it. And if it is him, I would rather end it here and move on to something else. If it me, I want to get past this so I can stop feeling like I am getting a screwed over.
I believe some of the stuff he has done has been a little shady which is also weighing in on my decision. Even though I have been with the startup I still don’t have any of my equity vested. Around 10 months in, he increased the share pool from 10,000 shares to 10mil shares making my initial shares pretty much worthless (his too). I then had to rebuy back in with a higher evaluation. Prior to launching our MVP, he was constantly talking about all the customers he had lined up but to this day we still don’t have a single customer even though we are currently offering our service for free. He has also been telling investors that I am already working full time on the startup which is a lie. He also refuses to talk about the equity in terms of percentages. His option is that percentage don’t matter and the only thing that matters is the share price (partially true). I do like the guy and he is a 100% committed but part of me is very apprehensive about believing what he says. What do you think?
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