[epc]

Do they have any other companies in their portfolio that they have already implemented this structure? Can you talk to the non-VC staff?

If you're not raising money, you're not doing the CEO job. My guess is they're willing to back you but see that you don't have the business experience to be CEO (and if you're the CEO, you're not going to be doing the engineering work you need to be doing to build the company). In this scenario is the single fund providing all of the $2.85MM? Is there a board? Who does the VC/CEO answer to? Do they see their role as interim (i.e. support you to a point where you could become CEO, or get the company going until it can bring in a salaried CEO)? Or permanent?

Do you want to be the CEO? or the CTO?

I'm not saying it's perfect, but a scenario where someone is bankrolling you and providing a CEO to handle the CEO b.s. while you build the company is also not that bad given the current funding environment. I'd look for some formal role definitions both on personnel as well as business (i.e. does the incubator provide basic business resources like HR assistance, payroll assistance, so that you're not burning precious seed $$ on that?).

Ask them to put in some protections for you in writing.

I mean, it sounds like they want to build the company around you and offload the crappy bureaucracy of running a company that you admittedly don't have experience with. Yes, they absolutely get a chunk of the upside out of it, but you get to focus on building the product. 10% equity seems low but they’re bringing the seed round in to fund the company and you’re getting a decent base salary. I'd ask for accelerated vesting and something to protect your equity from dilution through at least a Series A.

[torynoter2832]

#1 - They do have more companies. They all are in the right direction (Series A-C) but no big successes since it's all early. I'm assuming that the early companies got more attention from them though.

> "Do you want to be the CEO? or the CTO?" Yes but not a priority. I want to build a successful company and happy to give up my CEO seat if there's someone better suited.

> "In this scenario is the single fund providing all of the $2.85MM? Is there a board? Who does the VC/CEO answer to? Do they see their role as interim (i.e. support you to a point where you could become CEO, or get the company going until it can bring in a salaried CEO)? Or permanent?"

At this point they answer to themselves as they are the CEOs + Investors. Post series A, they will answer the new investors. They see their role in interim, but most likely hire an outside CEO, on which I have veto rights (this is in contract that they must get my thumbs up on CEO. But, they can also fire me so not sure if this actually matters)

> "I mean, it sounds like they want to build the company around you and offload the crappy bureaucracy of running a company that you admittedly don't have experience with." That's exactly right. As I said, it's my dream job, and still I can't get over the fact that 10% while doing 99% of the day to day is too low.

What do you mean by accelerated vesting? I do have some terms in case of acquisition, but I'd be diluted at series A

[epc]

"Normal" vesting tends to be over four years with a one year cliff (and then quarterly or monthly afterwards). Then you’ve got Amazon where the vesting is weighted towards the end of the period (I don't know the breakdown but for example instead of 25/25/25/25 you might see 10/15/25/50). Accelerated vesting is simply that for key, pre-agreed upon, points or changes in the business your vesting schedule is accelerated. e.g. instead of 10% vesting over four years, perhaps you get them to agree to 25% first year, then 50% once the Series A closes. Point being to lock in some upside for you once you AND they lose control over the company (potentially) by bringing in outside investors.

I have never worked for a successful startup to exit, either quitting or being reorganized out of a role before an exit. So take my advice with that huge caveat. But one final bit of advice is before you proceed find an attorney savvy about startup corporate structures and equity to review all of your documentation and contracts.

|Edited to add this link: https://www.investopedia.com/terms/a/acceleratedvesting.asp

[torynoter2832]

Yes thanks! There's an accelerated vesting in case of acquisition.

Unfortunately I signed the contract 2 months ago. So I might be too late. At this point I can't negotiate. I can either take it or leave it