On Sun, Jan 13, 2008 at 01:21:57PM +0200, aviv sher wrote: > Geoff thanks for the insight,
You're welcome, I hope it helps. > The CTO title means he will handle the whole Technology part of the system > (and the technology vision), and if he would like to change the technology > in the future it will be his decision... we also want him to be a good > programmer so he can support the current system.... we dont want anyone to > work for free so if my message was not clear... Again, IMHO, hiring a programmer to be a technologist is a bad move. Once you start the company going, you are stuck with the technology. You can do a demo, or proof of concept in almost anything, I've built prototype handheld devices that ran RedHat 9, but would not run anything like it "in the wild". There are lots of companies who have tried to change technologies mid stream and failed. HotMail is a good example, when M/S bought them they went over to IIS, but it took many years if they've actually done it yet and only the kind of money that M/S could afford. Ask your self seriously, would Google have grown to the size it is if after a year of running their open source systems, they went to Oracle and IIS? Both are certainly capble of doing the job with as much tailoring as Google had to apply to what they do use, but when did Google reach the point they could not have switched? So the question, which you don't have to answer to me, but will have to answer to any prospective CTO who actually knows what one is, is when is that point of no return? I'll answer Hetz's question (from another email) with a question. If they were to bring into their team a real CTO or not bring in anyone at all, and put together a demo/prototype to get first stage VC money, would they be better off hiring a contract programer or outsourcing shop to do it for them? Especially if the demo/prototype only shows what their technology would look like to the end user, and not actually give it away? Bear in mind the first publication of an invention gives you a limit of a year to file a real patent application, and the day that website goes on line the clock starts ticking. > The job is a payable job :) the partnership is only so he will feel some > obligation (and may be make some big bucks in the future) I hate to be the bearer of bad news, but that's any awfully small maybe. How much equity are your really willing to give this stranger (i.e. not a founder) to be CTO? 5%? 10%? any more and you risk diluting your control and making your seed investor nervous. When the company gets to a "short exit", i.e. buyout in 2-3 years or IPO, the 10% will be about 2%. If you go for the long term exit, which someone is espousing in an article in Friday's Jerusalem Post (presented as an op-ed, but really a free ad for his "late stage" investment fund), that will be down to less than 1%. Each time you sell a share of stock, and each round of funding, the equity gets diluted. Conventional wisdom is that the CEO, when brought in before the angel/seed funding stage, starts out with 25% and ends up with 2.5%. A later stage CEO gets even less. Now that we know about who much of the equity that really will be, look at the likelyhood of it paying off. Across the world 95% of all startups fail. 75% of them in Israel, 85% elesehwere. Why do Israeli startups last longer? It's becuase they specialize in using private investors or zionist venture funds who would rather invest more in an Israeli startup than to see it fail and loose everything. They would rather keep Israelis working than cut their losses and run as it were. Small private investors hold on because they can't afford to loose their investments and keep pouring money in in the hope they can get sell it off instead of writing it off. Of course, the reality is that 1% of a $100m company is still a $1m, but the chance of it happening are less than taking the equivalent money in salary and buying lottery tickets. Geoff. -- Geoffrey S. Mendelson, Jerusalem, Israel [EMAIL PROTECTED] N3OWJ/4X1GM IL Voice: (07)-7424-1667 U.S. Voice: 1-215-821-1838 Visit my 'blog at http://geoffstechno.livejournal.com/ ================================================================= To unsubscribe, send mail to [EMAIL PROTECTED] with the word "unsubscribe" in the message body, e.g., run the command echo unsubscribe | mail [EMAIL PROTECTED]
