[bitonomics]

I would like to second this response.

All extremely valuable to limit long term risk. Over time someone(s) will have to leave the group and having this ironed out up front saves a lot of time, effort, and money down the road.

One thing to consider is cash contributions (if any) that might alter the allotted equity. Other than that, equal partners with vesting is a good way to go.

[brudgers]

Make cash contributions loans, not equity. The risks/reward of all the founders should be aligned, and aligned to working. The option of passive ownership is divisive.

[akavi]

At what interest rate? Seems to me the average startup's credit worthiness is somewhere between Junk and Non-Existant.

[brudgers]

Interest rate is pretty much irrelevant. If the startup fails, they're not going to repay. If the startup succeeds then the interest is dwarfed by the value of the lender's equity.

If the lender is worried about interest rates and credit worthiness, they probably should not be pursuing a startup. The idea of a loan is that it removes negotiations over a finite pie that probably is worth nothing over the long run.