Did I handle this correctly? Potential First hire left on Monday.

Hey All,

So I started building our product last April 2021 (while working full time) and today am more committed than ever. It is crypto related so basically a few months after prototyping I learned about regulatory issues.

I would estimate I spent > 20k getting lawyers etc... to allow us to get the legal standing allowed to operate. On top of probably thousands of hours of coding the concept from scratch to now a working MVP.

Around November a friend of my partner heard about the project and offered to help. Throughout this time the product was uncertain it would get to launch due to the above and I made that abundantly clear.

Anyways fast forward and we are able to process transactions. Please note that I do not view this as anything major, we still need to even see if this product has a market (another topic for another day). What was more important for me is for him to sign a formal vesting / options type agreement.

He has been quite present and did apply and get us into two incubators. His skill set complements mine, in that he is more willing to speak to many people etc... However minus that he is a recent grad and would be learning just like me how to build a product.

I initially offered him 2.5% (vesting schedule not determined) which looking back was a lowball but at the end of the day I have to start within my comfort zone.

After more negotiation I raised my offer but it reached my maximum level of comfort (12.5%).

Personally, I think this will just be a learning experience because the odds are it was 12.5% of nothing (start ups fail yada yada). He voluntarily chose to "help out" -- I made it clear I don't view him as a co-founder.

I do think that at the end my offer was motivation to build something together over time. I also of course said if/when a salary could be paid he would get priority as he isn't as financially stable as me.

The ability to join a technical founder in a project that he thought was compelling. Wasn't my offer more than fair or am I missing the "future work" angle.

I can say that I feel completely fine and that him leaving the project won't affect our ability to execute on our goals (which is telling). Also the incubators have been made aware and both of them still want the company in their programs. And a pretty serious investor reached out after reading our blogs just this morning (Google related). So... things will continue without him and of course I when the time comes to get someone onboard I will keep this experience in mind.

I think at the end of the day he wanted to be a 'co-founder' but there is no way that I felt comfortable with that.