What is founder status

How can a cofounder contribute to your startup idea? All these questions must be lingering in your head now. We understand how crucial this decision can be for a person who is planning for a startup or just a small business. Even a small glitch in the duties discharged by a cofounder can cause immense loss to a newly found business.

The most important aspect to keep in mind is the balancing of skills. Every individual can not be perfect in every other function. Hence, if you are looking for a cofounder, it is important to make a list of the skills you have mastered and skills that are required to run your business. Now, look for individuals who carry a set of required skills that are different from the ones you already have. This will help in ensuring proper functioning and balancing of power in the business.

Apart from the crucial functions of a particular business, there are certain generic characteristics a person must have in order to become a cofounder. If you are looking for one, make sure they stand firm on the following aspects. A cofounder should be open to the responsibilities of all forms. Even though the idea belongs to the founder, a cofounder is required to give their optimum best in every job they undertake. These responsibilities are different for every business.

Proper disposal of these duties helps in the quick growth of the business. A cofounder needs to adopt a variety of skills for the better implementation of the plans and policies. These skills include:. It could be marketing , sales , or even technological, depending upon the business needs.

A cofounder needs to know the basics of effective communication. Effective communication skills help in easy and quick dispersal of instructions, smooth negotiation, and negotiation process. He is the face of the company both on external and internal grounds. A skillset with good communication skills is always required within the representative. It is important to invest in people who transform every hour into a productive day.

Cofounders need to encourage their subordinates to put their best foot forward, irrespective of circumstances. Many people including me have lived this way on the path to success and it sucks, but it gives you a good origin story and a little grit. If you believe in the company go for it. Now, to elaborate on your situation. You need to make sure you are getting your fair share of the equity in exchange for your commitment. There is only one way to do this and it's called "Slicing Pie.

The founders are making a classic start-up mistake--trying to predict the future. No salary and benefits for two years? Says who? If you raise money tomorrow will you get salary?

What if it takes three years? Nobody has any idea what's going to happen in two years--not even an entrepreneur! Because the future is unknowable, any possible equity split decisions the team makes at this point will always be wrong. Think about it this way: when someone contributes to a startup and is not paid they are, in effect, "betting" on the future profits or sale of the company.

The value of the bet is equal to the fair market value of their contribution. People contribute all sorts of things including time, money, ideas, relationships, supplies, equipment and facilities. Everything has a fair market value. What's clear is that you are going to forgo salary for some, unknown period of time. You may even incur some business expenses for which you will not be reimbursed.

This is your bet. Betting continues until breakeven or series A. In other words, you will only know the amount of your total bet when you no longer have to bet because you are getting compensated. If you use this model you will get what you deserve to get no matter how long you go without salary. Remember me. Forgot password? Log in. Don't have an account? Hide my real name optional. Already a CoFoundersLab member?

A venture wants to hire me with founder status- the catch no salary or benefits for two years. How does one survive? Agree with the answer above, "hire" is not the right word here - you don't hire a founder. Typically, you hear people talk about "bringing in" a founder. But that's not the question. The question is, how do startup founders survive when the startup is pre-revenue or all the money is going back into the company.

There are many answers: Be independently wealthy to begin with. You made your fortune previously. Live off savings, your retirement fund or max out those credit cards. Have a non-entrepreneurial spouse or partner who covers your expenses Work a second and sometimes a third job. You wouldn't be the first startup founder driving for Uber.

I know a lot of startup founders who do consulting jobs while building their startups Get funding fast - find a VC to drop bags of money at your feet and give yourself a salary. Or Angel or Friends and Family funding.

Find a customer to fund the company and pay for you to build out your product Cut your expenses to almost nothing. I know a startup CEO who secretly slept under his desk at the startup incubator he was participating in. He lived on the snack food at the coworking space and frequented the many events. His expenses were very very low. Sell the vacation house, lakefront property, race horse, family silver -- or even take out a second mortgage or line of credit on your house.

Now you know why startups are seen as a rich person's game May 10th, They have the most at stake, often contributing their own funds to get the company going and working crazy hours as they push to get the startup off the ground. Especially in the early days, the buck stops with them. But a founding team member is an early employee, not a founder. One important difference? The types of stock the two groups receive. Most important: How do you choose the right co-founder?

The cliche is that a co-founder relationship is like a marriage. And, just like with romantic dating, your best bet is to get them to like you. We mean, really like you.

So how do you make them want you? Start by working out what you have to offer. What is it about you that people will want to follow? And then focus on the startup itself. An idea is generally not going to be brilliant enough to attract a cofounder on its own.

Prove that you have the ability to raise funds. The main reason? You probably won't find someone as passionate as you are about what you're building. And keep in mind, I have no idea who you are or what you're building so that's no judgement on you or the idea, just the reality I've observed over 20 years of startups. If you want an employee, just pay 'em.

Partnerships that aren't true partnerships end up a mess for everybody. The ideal number of founders is either two or three, with an exception occasionally made for four, depending on the startup and the team. The technical guy is the CTO. The money is guy is the CEO. The people guy is Head of Marketing. All that does is make things confusing for everyone else — including your potential investors — so, please, just stick to the common ones.

If someone has come along a little later in the game, but still early — as in, pre-first employee — then you treat the same any other co-founder! Your employees may feel put out by the fact that this newcomer is getting a higher title and potentially a higher level of respect than they are, when they were asked to take on more risk by coming on earlier.

Some conflict is inevitable, of course. Startup founders are only humans and will usually have at least slightly different goals, tactics, and skills than their co-founders. But Meghdad Abbaszadegan, whose walked away from his own startup, Feel Free, after it fell apart due to co-founder conflict, has worked out three things all founders can do to protect their startup.