Deano’s answer to: “How much equity should you give a CEO/Business Manager at a startup which has already started making some money?”

It's dead simple: 100% of nothing is nothing. 10% of Google is more than you can spend in ten lifetimes.

When in doubt, split everything evenly between cofounders at your first startup. Giving it any more thought is a waste of time.

Don't lose an A player to haggling, and settle for a B or C who meets your terms. Fractional millions is a win in any record book, and you have a product to roll out, and competition that doesn't sleep, has spies in your organization, and knows what you look like naked.

Worst case scenario, you revel in all the stories you'll be able to tell people about how my Quora answer screwed you and got you kicked out of your own bazillion dollar company. Then order another $400 bottle of wine from the oceanside restaurant your yacht has pulled in to, before retiring to your 800 thread count sheets so you can cry truffle-scented tears into your duckling-feather pillows.

On a more serious note – if you've already put in a ton of time and effort, make sure that shows up in the vesting. 50% with a vesting advantage at least gives you solid control for a few years, or until an investor takes interest.

For the record, I also recommend a four year vest with no cliff – just 1/48th of their total share each month for each cofounder, starting from the moment they sign on board. To me, the one year cliff is just laziness – why would you hold on to someone who wasn't working out for a WHOLE YEAR? From the opposite side, why work for a vaporware company for a year with potentially zero return?Think about it…

How much equity should you give a CEO/Business Manager at a startup which has already started making some money?

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