I see this sentiment it it's non-sensical. You're going to join a start for 25% and put in a quarter effort? I don't think so. You're seriously going to give up most of you're equity just to demonstrate your generosity? Nfw.
There is that nice story of the two cofounders who both tried to give the other 60%. Ok maybe, but this 60/25 statement is just grandstanding. If you would seriously do this you are too foolish to be a founder.
Refusing 60% equity is nothing like refusing free money. Think of it this way. I start something. I come to you and give you 100% of it. 100%! You take it, code, contacts, everything.
Now, you need a co-founder. Hey, what about me? What are you going to offer me? You can pick any number you like, but the point is that if I really am the best person to be your co-founder, you have motivation to offer me a substantial stake in the going concern.
So don't think of the author as "giving away" equity, think of him as taking 100% equity and then granting the CEO and original founder 75% to motivate him so as to maximize the value of the equity he keeps.
You might pick a different number, 50%, 49%, whatever, but you get the idea.
In other words, a deal is only good if it's good for both parts.
I would offer a potential partner 100%, but make clear I then wouldn't do any work myself if I didn't got a share. If both are equally dependent on each other, then a 50/50 split sounds just.
That's interesting, but I think wrong. First, a founding CEO doesn't need 75% versus 50% to keep them motivated. Second, if your are both going all-in, and your partner thinks you are worth 60%, you'd better have good reason to think you're only worth 25%. I could understand talking yourself down to 50/50 or 40/60, but 25%? That's makes no sense at all.
As I said, "You might pick a different number." I'm only arguing that declining all the equity you are offered isn't a WTF in and of itself.
As for the specific numbers... I really couldn't say anything without knowing the parties involved. Maybe these are completely fabricated to make a simple point, which is that he doesn't want to be lowballed, and he isn't outrageously greedy either.
Yep, just grandstanding. Point being that the equity offered should be commensurate with the value of the co-founder. If you're only offering 10% to someone who is worth 20%, don't expect to get full value. That guy will have a side project going while working for you.
It may not be grandstanding if the technical cofounder believes it's in his best interest not to take 60%. Maybe s/he feels that taking more would damage company morale overall, thus harming his/her investment.
There is that nice story of the two cofounders who both tried to give the other 60%. Ok maybe, but this 60/25 statement is just grandstanding. If you would seriously do this you are too foolish to be a founder.