Mike Adams

Founder equity is a sensitive subject but I wanted to share a couple thoughts I have on the subject that I think align everyone’s interests better and are just generally more fair than the current status quo: 1. I think founder vesting ought to be longer than 4 years. It’s just not really enough time from day zero, there is too much work to do ahead at day 1,460. This might sound “founder unfriendly” but when you think about it a bit longer it’s really not. A startup is almost never done in less than 4 years, and if it is everyone will get vested anyway. So really this is friendly to the founders who stay longer and do the work between days 1,460 and 5,000+. There are a lot of scenarios where a founder leaves after 3 or 4 or 5 years, with 20% of the company, and the remaining founder now has a huge amount of work left to do with a big hole on the cap table that no one sizing up the situation would really consider fair. 2. After the initial vesting period, I think founder refreshers tend to be way smaller than they ought to be. VCs will go through humongous contortions to tell founders why they don’t deserve the same refresh grant that it would cost to hire a replacement for their role. And at the end of the day all the arguments for paying the founders less eventually seem to boil down to “because we can get away with it”, which is not really a great way to do business. Same goes for any other exec here imo. So that’s where I think things ought to be — longer initial vesting periods, larger refresh grants — but unfortunately there are a lot of incentives making it tough to make changes on either.