Hi everyone! My co-founder and I are planning to start an LLC. We came up with this idea because our biggest investor, who happens to be my co-founder’s step-parent, wants us both to start a company together since we’ve successfully completed numerous projects together.
Regarding equity, our investor is seeking 45% since they will bring clients to the company. My co-founder argues that I deserve 20%, while they deserve 35%, primarily because they are related to the investor. I believe that without my contributions, our investor wouldn’t have suggested starting the company for us, as the previous projects wouldn’t have been completed. I also believe that I possess more essential skills for the business than my co-founder.
I find myself torn between two choices:
- Accept the deal to gain more experience, even though it may not feel entirely fair.
- Inform my co-founder that they may not be the ideal business partner I’m looking for and decline the deal, which also feels like missing out on an opportunity.
I would greatly appreciate any insights you have to offer. Thank you all in advance!
Walk away and find higher quality people to build with. Ideas are worthless, startups are all about co-founders.
This comment is assuming investment is easy to find which it isn’t. I agree about cofounders relationships being essential but also a lot of cofounders don’t come with a ton of capital.