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About to negotiate equity with co-founders — I’m the technical one, they bring the domain expertise and customers. What should I ask to make it fair?
r/SaaS
6/26/2025
SAAS TOOLS
| SaaS | URL | Category | Features/Notes |
|---|---|---|---|
| No specific SaaS tools mentioned | N/A | N/A | N/A |
USER NEEDS
Pain Points:
- Fear of unfair equity distribution among co-founders
- Concerns about co-founders not contributing equally or leaving early
- Risk of personal liability without proper legal agreements
- Uncertainty about how to value technical work vs. domain expertise/sales access
- Anxiety about future fundraising dilution and founder departures
Problems to Solve:
- Establishing fair equity split among technical and non-technical co-founders
- Creating legal safeguards against founder disputes or departures
- Defining roles, responsibilities, and commitment levels
- Protecting intellectual property and technical assets
- Planning for future dilution and employee stock options
Potential Solutions:
- Equal equity split (33% each) with vesting schedules (e.g., 4-year vesting with 1-year cliff)
- Performance-based equity tied to milestones (e.g., revenue targets for sales, MVP completion for tech)
- Founder agreements specifying roles, decision-making processes, and IP ownership
- Retaining control of technical assets until traction is proven
- Setting aside equity pool (e.g., 10%) for future employees
GROWTH FACTORS
Effective Strategies:
- Equal equity distribution to ensure balanced motivation and decision-making
- Vesting schedules (e.g., 4-year with 1-year cliff) to ensure founder commitment
- Performance-based equity allocation to align rewards with contributions
- Clear founder agreements to prevent early-stage conflicts
Marketing & Acquisition:
- Leveraging co-founders' industry relationships and sales channels for early customer access
- Focusing on pre-launch customer validation through domain expertise
- Using sales introductions as key growth accelerators (e.g., "five-minute intro to a major client is worth more than ten hours of engineering")
Monetization & Product:
- Valuing both technical execution and market access equally for product-market fit
- Recognizing that technical product alone is insufficient without sales channels
- Balancing equity between operators (70%) and investors (30%) for future fundraising
User Engagement:
- Establishing clear decision-making roles (e.g., CEO sets vision, CTO controls tech decisions)
- Building trust through transparent equity negotiations as a foundation for teamwork
- Avoiding prolonged administrative negotiations to maintain momentum