Allocating equity among co-founders is typically a process, involving a lot of gut feeling, some back of the napkin math, and good judgement. Is also a frequently asked question with no easy answer.
So here comes a great new tool, built by Foundrs.com, called “Co-Founder Equity Calculator“. Based on simple but important questions, it gives you what it believes is a fair equity stake for each founder.
Even if you don’t agree with the results, is a great way to get a productive conversion started with the founding team on how to allocate equity fairly.
Try it out!
We need a simple model to help us properly slice the pie. It needs to be flexible and fair. By fair I mean it needs to give each founder what they deserve. And by flexible I mean it needs to adapt over time to re-allocate the startup equity so that the distribution stays fair until the fledgling company takes flight. check out Mike Moyer’s book slicing pie it talks about 50/50 share and how to divide it through his grunt calculator.