I found a very nice article on Adii’s blog that hit home with me immediately. It discusses the equity distribution in a new startup. A topic that is often not handled correctly from the beginning of a new venture. This is usually because all logic gets lost somewhere in the romantic notions that you dream up for your new venture. This is something that I can definitely relate too and I just thought that Joel Spolsky, creator of Stackoverflow.com put the whole issue into words very nicely.

Fairness, and the perception of fairness, is much more valuable than owning a large stake. Almost everything that can go wrong in a startup will go wrong, and one of the biggest things that can go wrong is huge, angry, shouting matches between the founders as to who worked harder, who owns more, whose idea was it anyway, etc. That is why I would always rather split a new company 50-50 with a friend than insist on owning 60% because “it was my idea,” or because “I was more experienced” or anything else.

Im definitely a total novice when it comes to business and startups so I’m still absorbing any useful advice at a million miles per hour. I might not have a successful startup or two under my belt (like Adii) but I do have a failed one in there somewhere. I reckon that counts for something.

I definitely wish that I had come across this article a few months earlier… Or do I?

I actually dont know if it would have made any difference because sometimes banging your head against a brick wall is better than any advice out there. I can vouch for the validity of Joel’s words of wisdom. It’s not very often that you get someone out there willing to call a spade a spade.

Read the full Q&A on Answers onStartups.com