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How to get clients to stop micro-managing design?

How do I reward people who offer help but don't want cash or to join full time?

  • Background Information I am a tech founder with a strong computer engineering and business background. I have been working as a consultant most of my life. I used to run a successful boutique  consulting firm. The company still continue to grow today without me. Recently, I have decided to stop consulting and focus on a toy project and build a prototype. The business model makes sense and I tested my pitch on most of my friends, colleagues and clients. Apart from two persons who asked me if I was evil, everyone got really excited and a large portion of them started wondering how they could become part of it. The  concept is fun, bold and subversive. The two line pitch is easy to sell and often receive long emails about the legal and philosophical implications of the project. I already have two friends from the city who made small but committed offers for a small amount of equity before I even started writing a line of code. My plan is to finish my MVP, run a couple of experiments and then start pitching to both users and investors at the same time. I can code and I can sell. My weak point is graphic design but from experience it seems that creative lead can get bored really fast. I am still looking for a cofounder, someone I can trust, who can code in go with proven skills and experience (e.g. commits on GitHub) . In the meantime, a lot of people came to me and said... "how can I help?" for example a  creative made a really nice offer and wants to help with branding. He has a nice portfolio and the first draft in the proposal is solid... He usually charges a lump sum, his rate is reasonable but he doesn't want money. There is another guy who want to helps part time. He doesn't want money. He is helping with communication, writing and came up with some fun tutorial ideas to improve user experience. He comes from a gaming background. I keep getting offers from people who want to help in one capacity or another. They are all professionals with proven and useful skills. Most of them are contractors who earn  good money and don't work full time... they actually can dedicate time to the project but again they don't have the employee mentality, they will probably never work full time for anyone but you ask them to deliver something and they will do it and they know clients won't pay if the work is shit. This is what I told them: We must agree in advance on the value of their contribution. Either a man day rate or a lump sum fee must be agreed in advance. We must agree on a fair pre-money valuation. They should receive shares or options based on the valuation and rate. Estimates are broken down, realistic and reported frequently. All briefs are turned  as a user story. (I use SCRUM for nearly everything, not just code. Estimates are broken down and realistic. Progress is reported frequently and can be measure on our burn down chart. If you don't report progress into OnTime, you don't paid. I am completely transparent to them, they can see everyone's progress including mine. I value everyone's input but I call the shots. No design by committee please. Do you think this scheme can work and is fair? Should I create a dedicated option pool or just equity? I need to check the tax ramifications. I am going to end up with a bunch of small shareholders... but everyone's contribution will be documented and accounted for.

  • Answer:

    Coffee. Tea. Dinner. Lunch. Dinner. Conversation. Something to do together. Those work the best.

Leonard Kim at Quora Visit the source

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Anything from gratitude to ownership, depending on how and how much they help. Weigh a quick bug fix or an evening's conversation against a hundred hours. And is the help something you could do yourself (like coding), or something you couldn't do without them (like introductions)? People will help in small ways out of kindness or friendship or excitement for you. Take that for what it's worth. Treat it as a favor owed. edit: "Pay it forward" is a good way to deal with the small favors done for you or your startup by people who aren't deeply committed. Be grateful when people help you in some small way, and be generous when others could use your help.

Dave Stagner

What you really need here is a professional opinion. Contact a startup Lawyer. I will let you know the ramification of all the above suggestion put up by you. 1st Suggestion As fas as agreeing to a may-day rate or a lumpsum amount fee is considered this is the best option is the people helping you agree to it. If they don't we move to the second option as suggested by you. 2nd Suggestion While you can agree to whatever value you like you cannot issue shared and options based on that value. You will have to infuse capital and form a compay (get is registered) then only you can have its value decided and issue shares and options. Any price agreement that you do before shall not hold since the company (the separate legal entity) was not in existence then. For such agreements to be remotely valid they must be done with the company itself or with a person authorised by company. Since the company is not is existence now, nothing you do shall hold validity. 3rd Suggestion, 4th Suggestion, 5th Suggestion, 6th Suggestion All these suggestion by you shall only hold any ground once the people helping you agree to any of the first two options. Since all these are useful only when they actually agree to work for you. I think you should only deal with equity shares and see that you do not have a lot of shareholders are holding too many shares since that would give them considerable influence over the company (which you may not like at a later point of time) also this would greatly reduce your ability to issue shares and important people without diluting your ownership. Tax ramification should be a later concern. I would recommend that if you helper are helping you for free, let them do that. Pay them back when you can with your kindness.This answer is for information purposes only and is not a subs...

Suyash Manjul

If you feel those people can provide value start by having regular meetings to discuss your progress and problems/issues you are facing. If they provide value, offer them an advisor role. 1) Dowload Advisory Board template: http://www.seedcamp.com/2013/02/a-template-of-terms-for-bringing-on-an-advisor.html 2) Read: http://techcrunch.com/2011/09/22/free-startup-docs-how-much-equity-should-advisors-get/ Hope this helps!

Aleksandr Dresen

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