[jselzer]

Exactly... I also wonder about calling it "HIS product" in reference to the employee. If he is only an employee, it is not HIS product, it is the company's product (and the OP's, as a founder/owner).

In my opinion, intrinsic motivation for a project isn't something that you either have or don't have by nature. It is something that is built and nurtured by a variety of external forces (team members, education, working conditions, etc) until the act of performing a task is rewarding in and of itself.

Expecting early-stage employees to be intrinsically motivated while ignoring environmental factors that may be eroding that motivation is unrealistic.

[pbiggar]

Your first employee is almost closer to a founder than to an employee. It wasn't "HIS" product, which was precisely the problem.