If you like dreaming about bootstrapping a project that you think could become something big, one of the first obstacles you face is who's going to do the work. If the project's big enough, you'll need to partner with others to get all the work done and have a division of labor that helps you grow and possibly keep your day job while you see if the dream has legs.
Problem - if you're partnering with one or more people, the division of labor is rarely equal. If you consider yourself a workaholic, you're probably confident that you'll put more in than your partner. Whether that's true or not (your partner might think the same thing), you still have to figure it out.
Most people make the mistake of going 50/50, and then grow dissatisfied with the arrangement. Seth Godin had some good thoughts about how to deal with this recently, and since HR pros don't think about equity stakes often enough, I thought I would share here:
"A friend asked me to help him think about how to split the equity in a company he was starting. His colleague is contributing office space and some key technology. My friend is responsible for where the business goes from here. I told him this:
If you apportion equity, you will certainly do it wrong. That's because it's based on a snapshot, a moment in time. Sure, today, your partner's share is worth 50% and yours is worth 50%. His because of what he did, yours because of what you're going to do.
But a year from now, that number can't possibly be right. You may have acquired six more pieces of software, raised millions, traveled the world, closed sales and sold the company. Wow. Or, you may have done absolutely nothing.
So, my best advice is to say, "Today, right now, your contribution is worth 5% of the company and my creation of the company is worth 5%. The other 90% is based on what each of us does over the next 18 months. Here's a list of what has to get done, and what we agree it's worth..."
Nice advice - it doesn't solve the problem, should you disagree 18 months from now, but at the very least, it provides a framework where future work and contributions get rewarded and to keep both parties in the game with an eye towards the eventual stake.
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