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Worked at reduced rate for promise of 10% but cut 2 weeks before launch - Now what?

posted by: Community on 2016-10-14
tagged: tech-company, legal, partnership, co-founder
score: 3

I went to work for a business owner that originally just wanted me to develop a job board, but I described how we could take it to the next level and make a fully functional job website. He is serving a very small market niche and had the money so rather than do the original job. We decided I would come work for him at a reduced rate and then I would get 10% of the company.

I moved my wife and I as close as I could get to the small remote town and then started commuting daily to work. Originally I was supposed to have Fridays off to wrap some other work I had at the time up. This never happened. Additionally contracts were never signed because every time the issue was brought up he would deffer the issue. He did present me with a contract at one point but it was purely an employment contact and I was not going to sign that. Yes, I know I should not do work without getting signed documents.

So I spent the next 10 months developing the website and making it work just as he wanted. That being said I was really done in about 3 months because I had been working on it in my own time an additional 2 months before moving. Instead of launching right away he would come up with complete changes that had to be done to the entire layout/functionality for the additional time. Each time I would meet the request at times with a lot of apprehension because the process was taking so long and was completely frustrating because the product could be launched and we could be making money during development, but instead I was subjected to what started out as monthly and toward the end became weekly meetings that were nothing more than him coming to my office to tell me about how much the project was costing him and his “investors” (his parents which owned the parent company). Then 2 weeks before he “launched it” I got taken into his office and was told “We don’t need you anymore”…

I have been reading that since we didn’t have any contracts I might be entitled to 50% of the business as an accidental partner. But I want to move forward in a way that I would not have to work with this guy because I feel I cannot trust him. What should I do?

Answer 11357

posted by: Anonymous on 2016-10-15
score: 3

No contract actually plays against the owner in this case.

As a developer, you have all source code, and probably have your name in source code, know how it works, you know its strengths and weaknesses.

Several things you can do:

claim your right for intellectual properly. Owner will have to prove that he paid you (if he paid anything) for exactly what you have done and that he has a right to possess your IP;
using your source code start your own website / business;
reach owner’s investors explaining situation and proposing them funding you as a person who developed related IP and did all the work. This may be a good idea for several reasons: (a) they will be explicitly notified that there’s potential conflict of interests and they eventually will get problems from IP right investigation; (b) that they deal with person (“owner”) who is not trusted at the market (yes, you are the player on the market, and you represent it). None wants problems, if I would be them getting message from you with explanations I would immediately called for this guy to revise financials, business plan, and requesting satisfying you to close the issue; or even, after investigation, shut my relationship with him down.

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