Has anybody ever seen a co-founder equity split with the CEO taking a large majority of the equity? I'm talking like 80% between 3 people? Let's say two hardcore technical founders and one business minded engineer as CEO.
The argument I've heard is that they're going to give up most of that equity anyway during raises and they don't want to tie up others in that decision making process if they're not involved in the business side. Wondering what people have seen
They will all bear dilution in future rounds and investors are going to want to see alignment of all founders on the long term success of the company so I'd rebalance. 40/30/30 seems more fair if he insists on having a slightly bigger share. It also means you'll need 2/3 of the founders to do anything.
Mentor
This is probably a better move. But a lot depends on who is running the show, and how good everyone is at doing what they do.
Mentor
The founder who is pitching and herding the cats usually ads the most value. Raising money and making sure the company can offer a product and sell it really is the test of a startup. That said, too technical talent is hard to come by. There are a few value based equity calculators you can google.
Is the thought that future funding rounds will only dilute the CEO's equity and the other two founders will be insulated?
Agreed with C1. That would be a very strange way to organize things, and would raise some flags for me if I were reviewing the equity arrangement.