r/startups • u/Think_Yam4440 • 11h ago
I will not promote Update: I spoke to my co-founder again. We’re going to split. I will not promote
First of all, thanks again to everyone who commented on my original post. Through the comments I realized I was spending way too much time trying to find some percentage that would make both of us happy instead of asking the more important question: does this co-founder relationship even make sense anymore?
For me, the answer is no.
I wanted to talk to him properly in person. The timing was terrible because he had been away longer than expected because of a serious family situation involving a hospital. When I found out what was going on, I honestly thought this was probably the worst possible moment to bring it up. But he eventually brought up the company himself, so we talked.
He still wanted to continue. His view is that I don’t see his real value, that he invested a huge amount of time, learned a lot, sacrificed a lot, and that he could still prove himself going forward. He also said his value isn’t limited to engineering and that he could contribute in marketing, product and other areas. He also argued that I gained some technical knowledge and insights through working with him.
I don’t think that’s completely false. I probably did learn some things through conversations with him. But the main issue for me is still that I’m not using any of his work in the product we’re launching. No backend, no codebase,.. from his version. The current product is the version I rebuilt.
So I told him I think we should separate operationally. I continue with the company, he is no longer CTO, he doesn’t have to keep working on it, and he can move on and do something else.
I also told him I don’t think reopening 70/30,60/40 or any other split makes sense anymore. I genuinely don’t think there’s a number where both of us would feel the past is represented fairly. He mainly looks at time invested, learning and sacrifice. I look at what exists in the company today and what is actually being used. At this point, trying to force the partnership to work feels less healthy than separating cleanly.
The only thing I still want to resolve fairly is what passive economic participation he should keep after leaving.
I offered around 6%. To be completely honest, I offered that mainly because I want to acknowledge the time he invested and because we’ve known each other for a long time and him having a hard time rn. If I evaluated this purely based on what the company is actually using from his work today, I probably would have gone way lower.
His position is that he wants at least 15%, and that’s where I strongly disagree.
We also still need to bring in a genuinely experienced technical person later, so I have to leave enough room in the company for the people who will actually help build and scale it going forward.
I’ve also funded the company so far as well: AI/dev tools, infrastructure, subscriptions and other costs. I’m not saying that alone determines equity, but I think it belongs in the overall picture.
The company itself has also moved forward. We were already in an accelerator environment and have now been accepted into a higher-stage program that is much closer to market entry and launch. That also means I now have to figure out how to communicate externally that the person previously presented as CTO is no longer part of the operating team.
So that’s basically where we are now. The split itself is decided. What I’m trying to figure out is how to structure the separation fairly. My current offer is 6% passive equity for a clean exit. His position is at least 15%.
What do you think is actually fair here? Would you consider 6% reasonable? Would you go closer to 10% just to settle cleanly?
And are there better structures than normal equity for something like this? I’ve heard about phantom equity / virtual shares / VSOP-style arrangements where someone can participate economically in a future exit without sitting on the normal cap table in the same way.
Also, how would you communicate the story externally from here? He was previously presented as CTO in business plans and accelerator applications. Now we’re moving closer to launch and he won’t be part of the operating team anymore.
Again, thanks to everyone who commented on the first post. I honestly think without those comments I probably would have kept trying to “fix” the percentage instead of accepting that the partnership itself needed to end.