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Re-evaluate founders' equity?
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2 points
by nickh
5567 days ago
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When founders divide a startup's equity amongst themselves, are those numbers set in stone (ignoring future dilution)? I ask this because one of my co-founders has been pondering whether we founders should re-evaluate each founder's shares at regular intervals, based upon on how much work they've put in since the last re-evaluation. |
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If the total stock was allocated then it may be a tax issue to change.
The best option may be to have vesting periods that can then be accelerted based upon workload/responsibilities.
The other option may be to "contribute" stock into new corp or LLC, but again, looking at tax issues. I did this and it was not easy...
Or contribute assets (code etc) only (not stock) into new entity and close down the old company.
Or issue more shares enabling a vesting period (may be simplest thing).
Definitely consult with a qualified business accountant to avoid what could be major headaches and possible tax penalties.