Thread by @eisaiah_e

1/ This weekend, I’ve been reaching out to startup influencers to coordinate a twitter campaign where we celebrate Indie Hackers, bootstrappers, customer-funding, and Zebras during the unicorn-obsessed #TCDisrupt #DisruptSF conference October 2 – 4, 2019.

2/ If you want to join us, we’re using the hashtag #DisruptVC. One of the influencers I approached asked why #FounderFriendlyStandard gives founders a 24:1 voting advantage. The reason is to keep founders in control of their companies. Here’s an excerpt from the email:

3/ #FounderFriendlyStandard is a checklist of issues for founders in every country in the world, not just Delaware C-Corporations. Section 2.2 says that founder stock vests over 4 years. In some legal jurisdictions, unvested stock cannot vote.

4/ Thus, 24:1 voting rights allow founders to be generous with their equity while still retaining control during (and after) vesting. Here are additional data points we considered when writing Founder Friendly Standard Section 1.1, which gives founders special voting shares:

5/ @Google has 10:1 super-voting equity for its founders. @Snapchat doesn’t give shareholders any voting rights. Investors buy stock in these companies every day. As they should. These are great companies

@Google @Snapchat 6/ The Credit Suisse Family 1000 research found that companies controlled by their founders build for the long-term, which translates to a competitive advantage over time. credit-suisse.com/media/assets/c…

@Google @Snapchat 7/ Principal-agent theory suggests that agents (investors) may be more short-term focused than principals (founders). …cial-dictionary.thefreedictionary.com/principal-agen…

@Google @Snapchat 8/ Prospect theory suggests that diversified investors would engage in riskier behavior to seek outsized gains. Founders whose net worth is not diversified would often prefer the opposite. eisaiah.blog/prospect-theor…

@Google @Snapchat 9/ Many first-time founders don’t grasp the significance of these issues on an emotional level until it’s too late. Nor do they understand they can walk away from investment and things can be OK if they’re focused on cash generation and balanced growth.

@Google @Snapchat 10/ @dflanegan, #KABloom, and I learned these lessons the hard way. Founder Friendly Standard is our way of helping other entrepreneurs go further by raising awareness of the 17 issues in Founder Friendly Standard. Read it here: eisaiah.blog/founder-friend….

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