Cofounder Salaries (W2 or 1099?)

Hello 👋

For some context: I am the co-founder of an early-stage startup with 3 co-founders and 0 paid employees at the moment. Money is tight. It's time for us to write our first check, should I pay myself as a contractor or as an employee?

Fellow founders: I would love to hear how you paid your self in the early stage of your company. I have been getting mixed responses. W2 is the safest bet, while 1099 is cheaper. Gusto.com allows you to run 1099 payroll for yourself, even though you are the owner of the company.

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Thank you! :)