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4 Comments

How Do You Believe Equity Should Be Split?

Hi fellow IndieHackers,

For those who don't know, I've recently launched my own start up and am writing about the journey I'm undertaking throughout the process. My latest post is about equity agreements and my thoughts on it. I'd love to hear other IndieHackers' opinions on the subject matter in order to foster discussion.

How do you think equity splitting should be handled?

https://maxandreassen.com/2021/02/18/day-7-equity/

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    50/50% if starting out. If you bring someone in, then you spread it out over time. Say you got the product, but they are going to do sales. They promise they can bring in 1000 paying customers and you believe 1000 paying customers in 2 years will really get the company going strong. You might decide to go 50% over 2 years and 12.5% every 6 months so long as they have brought on at least 250 customers. You spread it out over time, because maybe they are really good and can get you 1000 customers in 1 month then quit with 50% equity. You also tie it to a measurable metric that way they don't hang around for 2 years and get 50% for nothing. It's tricky, but split fairly in a way you don't get screwed.

  2. 2

    even split amongst founders always.

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      What are your thoughts on equity for early employees who aren’t founders?

      1. 1

        Some version of (taxes in different countries make this tricky):
        a 20% option pool for all employees until liquidation.
        4 year vesting - 10, 20, 30, 40% across the first years.

        First 10 employees split 2% (so 10% of the pool)

        Never use equity directly in place for reduced salaries

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