We just shortlisted a Tech Cofounder on our Early stage Self funded Tech Marketplace startup.Hes good on the skill set but we are not sure yet on the ‘compatibility’ part- which we are counting on as very important as well for the core team. Whats the Best way to go forward with this: testing the ‘compatibility’ with salary for say 2-3 months before handing equities or straight away giving out equities? Affordability shouldn’t be an issue since we are highly particular on selection of the core team.
You use the title co-founder, which indicates a partnership and mandates that the tech hire (I'm assuming is the CTO) be provided with the perks and benefits of other co-founders. If you are using the term co-founder loosely and there is no formal co-founder designation in place, then wait 6 months to a year. Why? The tech hire was not part of the original team and equity is ownership. If you give equity it is highly expensive to buyout (think divorce settlement without a pre-nup). If you do give equity to this employee be sure to have a solid attorney draft the agreement.
Answered 6 years ago
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