Ask HN: Advice on cofounders wanting to kick you out

[throwaway3211]

Hello everyone,

I usually have an account with a decent 4-figure karma, but felt safer asking for advice on this topic through a throwaway account.

Here's the situation: we're a young startup doing some pretty cool things, but after we released our product to the general public things started going a bit apeshit. Many mistakes were made and we basically failed to iterate quickly enough, all the while bleeding money like a slaughtered pig. Or at least bleeding much more money than we can afford without managing to get much return on this, shall we call it, investment.

My official role in the startup is that of ceo and cto, if such titles even apply in a small team.

Now the situation has deteriorated so far that the other cofounder has decided he wants to kick me out of the startup because everything that's gone wrong is my fault and I am being very incompetent.

What I'd like to know is if anyone has any advice on what to do in this situation?

I was the original founder who started solving a problem and I seriously don't want to leave what I've poured my life into. While I understand that staying in the role of ceo is a bit unrealistic right now given my track record, I know I can still bring value to the startup and I honestly don't think the startup will, in the long term, be as awesome without me as it can with me on board.

So yeah, if anyone can offer some advice or share some experience on handling this sort of situation I would be much obliged.

edit: to clarify, I am willing to step down as CEO and take on a CTO job at least for a while, so that I could focus more on the things I'm good at.

[jtchang]

Who has final say in the matter? If both of you have even voting power than you need to figure out what each of you want.

You seem to want to stay in the startup.

Your cofounder wants you out.

This is where you start. Maybe you leave taking a percentage of equity with you. Or investigate vesting options where you immediately vest and step down to another role.

[tgrass]

Please quantify monetarily what you mean by "I honestly don't think the startup will be as awesome without me."

I applaud your humility in admitting the mistakes were in fact yours. But you offer nothing here that suggests things will be different in the future. Reconfigure your role so you can still contribute but allow someone else to make the major decisions.

[throwaway3211]

Not sure on how to monetarily quantify it to be honest, I guess the difference between being a 10's of millions a year and being 100's of millions a year.

As I said, I am willing to step down as CEO and just remain a CTO at least for the time being, however the other cofounder's stance is that I don't deserve even that much. They even went so far as to suggest I don't deserve even a code monkey job in the future.

[notahacker]

Unless that was a heated comment that was later apologised for, it sounds like your differences might be irreconcilable, no matter how much you can potentially contribute...

[Shakakai]

Couple follow-up questions:

1.) Have you admitted to your cofounder you screwed up? You're owning up to it here (+1) but to him?

2.) Did you just screw up your CEO part of the job or both CEO & CTO?

3.) Could you live with just being a code monkey (role player) for a while?

4.) How many people are in the company?

[throwaway3211]

1) Yes.

2) That one's a bit difficult to judge, I certainly screwed up the management parts of my job, whether I'm any good as an architecture designer and someone who makes technical decisions ... can't really tell; I think I managed quite alright.

3) I guess potentially I could, but not very happily. I'd rather remain a CTO and have some very hands-on/tough coaching regime to get me into shape within a few months.

4) Right now there's just the two of us, but some other people are involved on a looser basis.

[damoncali]

Just curious - how are you the original founder, CEO, & CTO, yet someone else has the ability to kick you out of the company?

[throwaway3211]

Well there are two ways this someone else can kick me out.

1. We have some advisors/extremely-early-investors so any two parties that band up together, have the majority share and can throw the third party out.

2. This someone else has been footing a lot of the bills for the startup because they could take on other projects while I worked on the product. Because the we agreed to mostly split the bills halfsies and I didn't have the money, the other cofounder payed for me and now I owe him the money. He is now requesting I vouch for it with a big enough share of the company so he'd hold the majority share.

Also, as mentioned, we're both in the company on a reverse vesting thing - this is so when problems occur, people can be thrown out without taking half the company with them (ie. better for the company, not for the persons)

And that's basically how someone else has the ability to kick me out.

[damoncali]

Then you need to settle with the other guy and one of you needs to leave with a small share of equity for time served.

[Angostura]

What's the nature of the agreement between you. Can you just dissolve the start-up and go your separate ways?

[throwaway3211]

The cofounder and I came together because of the startup. And we have the good ol' reverse vesting thing, neither of us is over the 0% boundary yet.

As for the startup itself, it's almost certain to get a follow-on of a certain government grant, so it wouldn't be the wisest decision to just dissolve it completely.