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Startup equity reset

 
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hitechfounder

posts: 3

May 10, 2009 2:52 PM ET    Quote  Report Abuse
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  I would truly appreciate advsie on below problem I have to resolve:
 
  Couple years ago person in my company used lack of my experience as a founder and get allocated very big chunk of equity.
 
   He did not delivered on any of his promisies, but he still hold this equity
 
   What can be done to resert company`s equity allocation without closing it?
 
    What VC`s do in this case?
 
 
   
 
robertj

posts: 1458

May 11, 2009 8:30 AM ET    Quote  Report Abuse
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I`m sorry to hear about your difficulties.

Unfortunately, unless there was a something in your original agreement - your only avenue may be to buy back the ownership from him. This can be challenging, if he doesn`t have any motivation to sell- he could "hold out" for a big price.
 
If you`d like to discuss the specifics in confidence - send me a PM or contact me directly.


-------------------------

Business Growth Masters, LLC -
Capital Catalysts for Entrepreneurs
Home of the Scalable Business Plan and QuikStart Capital Programs
http://www.bizgrowthmasters.com
info@bizgrowthmasters.com


FastVentures

posts: 306

May 11, 2009 11:33 AM ET    Quote  Report Abuse
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Well, your options depend on a number of different factors, including (i) is a “big chunk of equity” to be understood as a majority shareholding; (ii) what agreements and contracts do you have in place, (iii) your position in the company (are you a key man) and how you’re getting compensated; and (iv) is the company profitable.

Your chances to balance the scales will probably depend in large on your ability to create leverage. In short, there are many options you can explore; whether doing so makes sense usually comes down on how badly you want this and if the company is worth it.

You can PM me if you don’t feel comfortable discussing details in a public forum.

Cheers!


Mark



-------------------------


Jackson Steiner
http://www.JacksonSteiner.com

Advanced Document Design for entrepreneurs, intermediaries, and the financial services industry.
http://www.Publications.FastVentures.com
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