Going through a dilemma, trying not to be greedy but also trying to protect myself. Need to validate if Im coming from a valid position or misinformed.

Background:

Joined a startup per request of a friend with 5 people in total. We are working for equity only. Company has no profit and no outstanding offers. There have been potential investors but only potential and no made offers.

Now this friend is a good friend of mine. Old colleague and all. Asked me to come on to build the product. I am a software engineer with extensive experience building out products. He also has a rather big software background.

(Regretfully….) I signed a contract based on deliverables and a timeline. I have far exceeded the timeline of delivery. We also since I built the product are able to begin demo’ing a near finished product to customers. As we approach what could be pretty lucrative offers I requested more info into the breakdown of the company and shares etc.. (Should of asked upfront)

Much to my dismay, and being trust worthy. The breakdown is as follows:

CEO – ~35%

CMO (Not sure actual position) – ~30%

Friend (CTO) – ~20%

Another Dev – ~4%

Myself – ~4%

Rest Investors – ~7%

Now for the application:

I built the Mobile Application for iOS & Android ( React Native )

I built the Client Web application

I built the entire Backend ( AWS, Lambda ,Cognito, VPC’s, AppSync, SNS, )

All deployable with the CDK, Ive got some small build pipelines. Backend has about 95% test coverage. Lots of moving pieces, logic but all builds are reproducible across accounts.

Without exaggeration I’ve built 95% of the project. No outside help and purely my own hard work and grit.

The other Developer has down a few things with CSS and what not but purely front end things.

So after getting this breakdown I brought it to their attention that I thought I was being highly undervalued. It is a tech startup and that I think I should get something reasonably more. I asked for 10-15%. (Again Im doing this in my own free time out side my full time job ).

They came back and said 6%.

Also my Exhibit A only says shares by milestones and nothing else. I told them that had I known my shares were so low I could not have agreed. I was told it was in my document but after pulling it up I showed as I remembered it indeed had NO % breakdown of what the shares meant. Just told a number we got and that is all.

They refuse to give me more than 2% more which becomes a 6% total. Told me their plan in is to pay us big salaries. Nothing in writing. Also that they took more risk as they have been lobbying 2 years as we need government approval.

The CEO is the only whom has spent money. (By the way which I think the CEO is the bomb ).

To me it looks like Im highly undervalued being I built the entire application for what is a Tech startup. Which I tried to make the argument which I was told that initially its work but after it would be just passive.

Im basically setup that I build the entire MVP for free with barley any equity which they could just remove me, never uphold a promise and I walk away with barley anything compared to their percentages.

I feel that I took quite a risk doing this all for free and felt that since my friend was someone I was close with that I was taken care of. I no longer feel the same way.

Trying to figure out if Im being justified or not. I spent an absurd number of hours to this point but feel like Im setup to get out’d while others profit from a ridiculous amount of work.

I am also told I that I am not valuing them and all they have done so far…

**NOTE**

I would just like to say thanks all who have responded and continued the conversation. There’s a lot that can be said about either side. Strong points made on either side. It’s no easy decision, mistakes were made definitely.

One thing holds certain though. Having people take the time to provide feedback has been immeasurable.

The most important commodity we all have is time and it means a lot that it was spent to help me problem solve. I hope I can provide you all as much value in the future as you have given me.

** Update ** After much consideration and thought I officially resigned. I worked on a milestone basis with shares released after each milestone. Just never a document read what that meant in the grand scheme.

I’ve always planned and worked towards being a founding member and a vital player. Upon realizing I was merely a contributor and not a founder it dawned on me that in my own opinion, the time was wasted working towards a position that did not align with my true end goals.

I offered to make the transition easier by providing hand off documents and a walk through of what’s done.

Too anyone going through a similar situation and finds this post, I hope it helps make your own decision easier.

There will be those who say “honor the contract” indeed. I do believe one should in circumstances. Yet sacrificing a great deal to be under valued is no reason to continue. The only thing that kept me working those hours was that it was for the team I was a part of, not a team I was working for. At this point, the quality of work would more than likely diminish and it may hurt the product more than finding someone who is motivated to finish out the final steps.

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Title Of post: Startup for equity with no revenue – CEO spent 100k of own money to date
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