I'm sure I'll be violently opposed here, but it seems like an awfully poor heuristic that creations are statically split at mint-time, as opposed to - say - the amount of labor put down over time, at least for a founding team.
For instance, let's say I and a friend created a company, and run it together for one year. She keeps her share, but stops contributing. I then keep working for 3 more years. In total, we created this thing over 5 person-years. A natural baseline split would be 20-80.
Obviously you can do more accurate heuristics based on skills, experience and other factors, and having salaried employees are outside of the equation.
In either case, I'd feel horrible in a hypothetical situation where my cofounder quits early with 50% and sit back and hope to cash in on future hard work from me. And not only that, but makes decisions over a company he's not operationally involved in.
As I mention here: https://news.ycombinator.com/item?id=30612983, at the monetary level, I don't think this is a conflict over a 50% stake, but rather over the valuation of a 45% stake (at the end it would be a 95-5 split).
But in general yes, my impression is there are usually agreements in place to reduce an ex-founder's share of the company over time.
>I'm sure I'll be violently opposed here, but it seems like an awfully poor heuristic that creations are statically split at mint-time, as opposed to - say - the amount of labor put down over time, at least for a founding team.
That sounds reasonable. The problem is when people don't do the leg work to set up a framework to handle more complex share splits. Sans such a framework, the default is to split at mint time because that's how stakes have historically worked and the legal system should, in theory, minimize funny business possible when someone doesn't have a contract specifying any specific details.
The general outcome here is that the 'no contract' way of splitting shares is pretty bad, which seems in line with the no contract way of doing anything other transaction or business dealing. That way of doing business only works for small time transactions, say in the 2 or 3 digit range.
I'm sure I'll be violently opposed here, but it seems like an awfully poor heuristic that creations are statically split at mint-time, as opposed to - say - the amount of labor put down over time, at least for a founding team.
For instance, let's say I and a friend created a company, and run it together for one year. She keeps her share, but stops contributing. I then keep working for 3 more years. In total, we created this thing over 5 person-years. A natural baseline split would be 20-80.
Obviously you can do more accurate heuristics based on skills, experience and other factors, and having salaried employees are outside of the equation.
In either case, I'd feel horrible in a hypothetical situation where my cofounder quits early with 50% and sit back and hope to cash in on future hard work from me. And not only that, but makes decisions over a company he's not operationally involved in.