equity, employees, partnersI am starting a project. Let’s call it a project because it’s not a company just yet.
But I started looking for people to help with this project. Now these people that help me, is it better to consider them employees or partners?
If I find considerable merit in one or more people, is it wise to have them sign a shareholders agreement and give them a piece of the company? Or is that something that gets sorted out down the road?
Thank you for any help on this.
It is always better to get things sorted out in the beginning itself rather than later. This will avoid any confusion and set the right expectation for all parties involved. If you are looking for people who are doing substantial work on the project you should consider them as partners and give them equity. Even advisers to startups get compensated with small percentage of equity. By sharing with them you ensure that their interests are aligned with yours and the company.
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