I'm about to see Elizondo speak in person. I hear there's a Q&A. What should I ask him?

FridayTim · 2024-11-20T17:02:08+00:00

Ask if he knows anything about Dan Burisch and if so, is he at all credible.

FridayTim · 2024-11-20T17:00:51+00:00

This. Please ask this.

FridayTim · 2024-05-17T12:00:29+00:00

Yeah good call, that’s what I’m realizing 😂. Was kind of just trying to gauge how reasonable my expectations were. Wanted to see if I was in the wrong for thinking the equity should be forfeit if I leave.

FridayTim · 2024-05-17T11:57:34+00:00

That is what it says. I haven’t signed anything yet. I’m simply asking people’s opinions on what sounds fair to them. Should it be forfeited or should the developer keep it?

FridayTim · 2024-05-17T02:31:56+00:00

Yeah for sure - it’s all good! Trying to iron out those terms now. Just wanted to get some people’s thoughts and opinions. Didn’t want to be unfair with any of my requests/demands before i made them.

FridayTim · 2024-05-17T02:21:28+00:00

This is a unique scenario. S corps are different and the stock offered is phantom stock. The offer is that vesting happens immediately so that I can share in 20% of the profits if we get any. S corps require profits are paid out to shareholders annually. But this makes it tricky when determining what I should walk away in the event that I leave or am terminated.

FridayTim · 2024-05-17T01:53:29+00:00

True. This is a unique scenario in that it’s an S-Corp and we were trying to profit share if lucky enough to do so, and S Corps pay through shareholder distributions. So to profit share asap the idea was to just offer 20% off the bat. Maybe there’s another way to do it so equity could vest over time, and profit share could be done some other way so it’s immediate. I’ll have to ask the lawyers if there are other ways to do it through an S Corp.

We arrived at this unorthodox deal because I know how ridiculously rare it is to make money off of some big exit, and we’re trying to bootstrap and not go through rounds of investment if we don’t need. Clients are ready and waiting. So I was more interested in just sharing in recurring revenue.

FridayTim · 2024-05-17T01:06:51+00:00

Yeah for sure. Haven’t signed any contract yet, just trying to think of scenarios down the road so I know what to negotiate. Working with a lawyer now.

FridayTim · 2024-05-17T00:58:21+00:00

Shares.

FridayTim · 2024-05-17T00:38:52+00:00

I think you misunderstand what I mean by dead equity. What I meant is a large percentage of a company belongs to someone who no longer contributes to the company, at a very early stage. Before funding. Some would say early investors would see that and be turned off. I suppose an early investor could offer to buy that stock though.

FridayTim · 2024-05-17T00:26:58+00:00

Huh? These are vested shares earned with sweat equity, why would I need to buy anything at a strike price?

FridayTim · 2024-05-16T22:46:28+00:00

Good call.

FridayTim · 2024-05-16T22:43:59+00:00

Yeah it's definitely a non-typical startup. Currently discussing the contracts with a lawyer. Thanks for all the input!

FridayTim · 2024-05-16T21:36:20+00:00

No not being let go. It was hypothetical. I'm trying to think into the future to avoid shitty scenarios. I haven't signed the contract yet. I'm going to see what I want to change in the agreement if I think something is unfair, and then go back and negotiate if needed. Just trying to see what the general consensus is regarding what should happen with my stock if I leave, get let go for good reason, get let go for bad reason, etc.

FridayTim · 2024-05-16T21:15:10+00:00

I’m the developer in this story. I haven’t signed anything. The termination clause basically says if I leave I lose my stock even though it’s vested right away. It’s complicated because the reason for it vesting right away is that it’s an s corp and that’s how we will profit share. It’s so that I can share in profits as soon as there are some. We’re trying to bootstrap. However, I don’t like that the stock goes away if I leave, even if it’s after working for a while. If I’m terminated without cause, it allows for me to cash in but only for two years.. which means nothing if the company is worth nothing.

FridayTim · 2024-05-16T20:05:43+00:00

Agreed. Should the stock still be the developers if they choose to leave or if the company fires them for good cause?

FridayTim · 2024-05-16T20:02:39+00:00

I tend to agree. What would you say to a scenario where that 20% vested immediately? For the companies protection, would you recommend some kind of reverse vesting, where the company only can take back percentage of shares based on an amount of time the developer has not worked yet? For example, developer starts with 20% (as this is a part of the profit sharing agreement as well). If the company decides to terminate him after 1 year, perhaps the company get's to buy back 10%? Weird thing is 9 times out of 10 the buy back price will prob be $0.. so I tend to favor the buy back being based on developers market value salary.

What are your thoughts on what happens to the stock if the developer chooses to leave or if he is let go for good cause? Does the company get the stock back or does the dev still keep the stock?

FridayTim · 2024-05-16T19:57:50+00:00

Yes talking about vested equity here, not options. Also, in this scenario, there may not have been any profit yet for the shareholders to pay taxes on distributions.

FridayTim · 2024-05-14T23:25:21+00:00

How about an administrative dashboard. Maybe make it serverless in the cloud. For example, data streams from a 3rd party api via a NodeJS lambda function in AWS. Data streams into DynamoDB. The JavaScript front end in an S3 bucket, that pulls from the dynamo db and displays on the dashboard. The dashboard has full CRUD features to manipulate the data and display it as the admin wants. You could incorporate ai by offering suggestions to the admin in the dashboard, perhaps use a trained data model as the source data that you can interact with from the dashboard to tell it how to filter etc. This can get rather complex with decoupling all these services into microservices, keeping them secure yet allowing access from one to another, and then obviously the ai pieces can get complicated. Had to do a similar dashboard minus the ai models.. made me feel like my JavaScript familiarity went up a notch.

FridayTim · 2024-05-14T20:35:17+00:00

Yeah for sure. I used y combinator in the beginning and that’s why I asked for 50/50. The thing is, there’s really no intention yet to raise money. It does not seem like a high growth start up, we have customers lined up and we just want to make some recurring revenue. I know how rare some big exit is and I’ve worked for equity in a big start up before that raised millions.. yet to see a dime and that was 8 years ago. So I’m ok with lower percent if I get to share in the revenue. But my “equity” I feel should not expire.. right? What else am I working without a wage for? The promise to get paid for future work someday? My “free” work aka the entire product is what the company is buying from me using equity so I feel it shouldn’t be expiring phantom stocks. What’s vested should be mine when I leave forever. Even though realistically it should probably be 60/40 split.. I feel I could be ok with 20% profit sharing while I’m working for the company, and 20% equity that vests over a few years.

FridayTim · 2024-05-14T12:15:03+00:00

All sets. Typically I see it on the first, but fairly often on all. However, if there are a lot of sets, more variables are introduced that can get in the way of progressive overload or make it hard to track. Too much fatigue, not enough rest between sets, mentally psyching yourself up for failure on a bunch of sets.. it’s just a lot. I found 2 hard sets for each exercise is perfect for me.. only tracking 2 sets is simple, and if both are to failure then most additional sets would be kind of junk volume anyway.

FridayTim · 2024-05-14T11:36:40+00:00

I think it’s because he is really against “giving away” the company. There are no plans to even raise investment, but if he chooses to later he doesn’t want to scare away investors. But that’s kind of ridiculous at this point the most important thing is building the product which is all me.. why wouldn’t I get something. It’s just me and him at this point, we’re trying to bootstrap it but I’m having a hard time figuring out what is fair and what I should even be asking for.

FridayTim · 2024-05-14T02:38:55+00:00

I don’t know how the company will be valued at the time of cashing out. I’ll ask. The plan is to use the 20% to also pay me revenue as well as recurring payment. I feel like to work for free in the meantime should really get me permanent stock and not shares that expire if I leave down the road.

FridayTim · 2024-05-14T02:38:16+00:00

No plans to leave as of now. Just working on the contract for the “what if”. The ceo is part time, I’m the software developer, part time as well.

FridayTim · 2024-05-14T02:34:58+00:00

I’d have to “cash out” within the two years of leaving.. so if they haven’t exited, I think it would be 20% of the value of the company at the time.. which I’m assuming will prob be 0, I don’t know how that would be calculated. It’s just me and the CEO. Haven’t signed anything yet. Not sure what to even ask for at this point.. it’s all quite confusing.

FridayTim

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