Negotiating Startup Equity Splits (Valuing Sweat vs. Capital)

http://cenkuslaw.com

If you need money for your startup should you give up a huge part of your startup equity to get it?

It's human nature overvalue the things we want but don't have, and undervalue the things we once wanted so badly but now obtain.

Nowhere have I seen this more apparent than when a startup founder needs money and is willing to give up a huge amount of equity to get it.

This poses a gigantic problem for a number of reasons, the most prominent being that giving up upwards of 50% of your business early on disincentivizes you to continue working as hard on your project. Additionally, you eliminate the possibility of future rounds of capital investment.

So, if you have a startup and need money, how do you avoid these problems? Great question! Take a look and leave a comment or contact me with any questions.
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This is the tenth video in my Business Partnership Mastery Series, where I dive into both the philosophy and legal nuts and bolts of mastering business partnerships. If you are a current or future business owner, you will definitely want to stay tuned for videos in this upcoming series, so make sure to subscribe!

Inspired by the content in my book, Partner-Proofing Your Partnership, I will touch and expand on the primary concepts I fleshed out in that short read which you can find here:
http://www.businessattorneyinaustin.com/brett-cenkus-partner-proofing-your-partnership-ebook

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For a deeper dive into and other legal issues vital to the success of your deals and your business, visit me at:
www.cenkuslaw.com

Just starting up? Check this out for my advice on startup success: www.thestartupshepherd.com.

You can also reach me at:

https://www.linkedin.com/in/brettcenkus
https://twitter.com/BCenkus
http://www.cenkuslaw.com
http://www.cenkus.com

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About me:

My 20+ years of experience in business finance, business law and entrepreneurship have led me to believe that numbers and logic are awesome tools, but understanding human nature and emotions is the first step to business success.

The Cenkus Law Firm provides services related to mergers & acquisitions, general business issues and startups, including founders’ agreements and fundraising. I also consult with entrepreneurs and have invested my own capital as an angel investor.

From 2010-2013 I served as Chief Legal Counsel of a publicly-traded international oilfield services company. From 2001 to 2006 me and a partner founded and built Paragon Residential Mortgage. Paragon was sold to Bridge Investments in 2006.

I hold a Juris Doctorate from Harvard Law School and a Bachelor of Arts degree in Economics from Messiah College in Grantham, Pennsylvania.

Now, I live in Austin, TX with my wife and two kids. I enjoy reading, running, classic movies, great food and wine and some great American football.

Видео Negotiating Startup Equity Splits (Valuing Sweat vs. Capital) канала Brett Cenkus