<story><title>Ask HN: My startup has concealed from me that it raised funding. What to do?</title><text>I&amp;#x27;m a founding engineer at a startup and just found out that the founders have concealed an investment from me leaving me with a potential tax bill on $10,000s of income that I had not received.&lt;p&gt;I did my best to keep my story within 2000 words but I couldn&amp;#x27;t shorten it anymore without leaving off important details so I posted the full text here: http:&amp;#x2F;&amp;#x2F;pastebin.com&amp;#x2F;xLLNUF0H&lt;p&gt;I feel so disgusted and cheated right now. I had worked for this company for almost 3 years doing everything possible to maximize its chance of success: from working overtime to meet deadlines to answering support emails on weekends, and now I find out that they&amp;#x27;ve kept this investment (and the tax implications that go along with it) hidden from me for over a year. I&amp;#x27;m left thinking that they concealed it so they wouldn&amp;#x27;t have to give me a raise, but I am more concerned about the tax implications of these shares. I had to leave work early yesterday when I found out about this and I don&amp;#x27;t think I&amp;#x27;ll be able to come in to work today. What should I do? Should I confront the founders about this? Is there any use in contacting a lawyer?</text></story><parent_chain><item><author>smt88</author><text>&amp;gt; and try and blow up the deal or company&lt;p&gt;Never do that. Not only does it create bad blood, which could only be bad for you in the long run, it may also leave you open to a lawsuit.&lt;p&gt;The business world is often about shoveling shit. People who always get their revenge tend to have no friends and lots of burned bridges.</text></item><item><author>aantix</author><text>OP should consider this a good lesson (and one that I learned going through an acquisition); unless you&amp;#x27;re a founder, you cannot control &amp;quot;the deal&amp;quot;.&lt;p&gt;Unless you&amp;#x27;re in the room when the chips are (re)divvied up, you have to trust someone else to advocate for you.  And after tolling away for a few years, trading your life for the promise of a better future through being acquired, ultimately you end up in a shitty position.&lt;p&gt;Don&amp;#x27;t be diluted in thinking the founders will &amp;quot;take care of everyone&amp;quot;.&lt;p&gt;Your only leverage in the end is to walk away (and try and blow up the deal or company, if you&amp;#x27;re that critical). And if you do walk and they don&amp;#x27;t stop you and counter offer, you probably weren&amp;#x27;t going to get anything anyway.</text></item><item><author>CPLX</author><text>Well despite the fact that this is very stressful, I would start with the maxim that one should employ Hanlon&amp;#x27;s Razor[0] and not ascribe to malice what can adequately be explained by stupidity.&lt;p&gt;It&amp;#x27;s quite possible, nee probable, that they are just disorganized and genuinely thought you already knew, or that it didn&amp;#x27;t matter, or otherwise were clueless or inexperienced enough to not really understand what had happened.&lt;p&gt;I think it would be a mistake to get into it with them on a war footing. Early stage companies like this make mistakes of this kind all the time, and it&amp;#x27;s not necessarily a sign that the whole ship is doomed. If they have the ability to get revenue and investment and pay salaries and whatnot it&amp;#x27;s possible that there&amp;#x27;s a positive outcome in the future.&lt;p&gt;I would schedule an initial consultation with a lawyer who deals with these kinds of things. Get a referral and schedule an hour or so to go over it with them. They&amp;#x27;ll probably charge you a few hundred bucks, or even waive it if you have a close friend or existing client of theirs refer you.&lt;p&gt;Sit down with a lawyer, bring the docs, and explain what happened and get some sense of the implications. Then approach the founders with the attitude that it must be an administrative mistake or misunderstanding. If they are evasive or otherwise shady that should become clear quickly. If they are genuinely concerned and want to help fix the problem then great. But personally I wouldn&amp;#x27;t blow up your relationship with everyone until you have a better idea which of those two scenarios is more descriptive.&lt;p&gt;[0] &lt;a href=&quot;http://en.wikipedia.org/wiki/Hanlon&amp;#x27;s_razor&quot; rel=&quot;nofollow&quot;&gt;http:&amp;#x2F;&amp;#x2F;en.wikipedia.org&amp;#x2F;wiki&amp;#x2F;Hanlon&amp;#x27;s_razor&lt;/a&gt;</text></item></parent_chain><comment><author>aantix</author><text>&amp;gt;Not only does it create bad blood, which could only be bad for you in the long run, it may also leave you open to a lawsuit.&lt;p&gt;Don&amp;#x27;t buy this fud. There&amp;#x27;s nothing illegal about walking away from a shitty deal.  Whatever your motives just plainly state &amp;quot;this deal no longer makes sense for me&amp;quot;.&lt;p&gt;If you&amp;#x27;re a great engineer, then have some self respect, and walk away from a shitty deal.  Go somewhere else where they respect the people that build value.&lt;p&gt;And if you aren&amp;#x27;t a great engineer, you weren&amp;#x27;t going to get anything anyways, so go somewhere that will raise your game and better positions you for the future.&lt;p&gt;&amp;gt;People who always get their revenge tend to have no friends and lots of burned bridges&lt;p&gt;There&amp;#x27;s a big difference between being bitter on a daily basis vs coming to terms with your past three years that are basically only going to net you an extra 100K (which you could easily get hustling in a few months consulting in SV).&lt;p&gt;Think deliberately about what you&amp;#x27;re toiling away for.  An extra 20K?  An extra 100K?  REALLY? All the extra weekends for years is worth that?  Get mad at yourself.  Demand more.  And if they deny you, walk, and position yourself better next time.</text></comment>
<story><title>Ask HN: My startup has concealed from me that it raised funding. What to do?</title><text>I&amp;#x27;m a founding engineer at a startup and just found out that the founders have concealed an investment from me leaving me with a potential tax bill on $10,000s of income that I had not received.&lt;p&gt;I did my best to keep my story within 2000 words but I couldn&amp;#x27;t shorten it anymore without leaving off important details so I posted the full text here: http:&amp;#x2F;&amp;#x2F;pastebin.com&amp;#x2F;xLLNUF0H&lt;p&gt;I feel so disgusted and cheated right now. I had worked for this company for almost 3 years doing everything possible to maximize its chance of success: from working overtime to meet deadlines to answering support emails on weekends, and now I find out that they&amp;#x27;ve kept this investment (and the tax implications that go along with it) hidden from me for over a year. I&amp;#x27;m left thinking that they concealed it so they wouldn&amp;#x27;t have to give me a raise, but I am more concerned about the tax implications of these shares. I had to leave work early yesterday when I found out about this and I don&amp;#x27;t think I&amp;#x27;ll be able to come in to work today. What should I do? Should I confront the founders about this? Is there any use in contacting a lawyer?</text></story><parent_chain><item><author>smt88</author><text>&amp;gt; and try and blow up the deal or company&lt;p&gt;Never do that. Not only does it create bad blood, which could only be bad for you in the long run, it may also leave you open to a lawsuit.&lt;p&gt;The business world is often about shoveling shit. People who always get their revenge tend to have no friends and lots of burned bridges.</text></item><item><author>aantix</author><text>OP should consider this a good lesson (and one that I learned going through an acquisition); unless you&amp;#x27;re a founder, you cannot control &amp;quot;the deal&amp;quot;.&lt;p&gt;Unless you&amp;#x27;re in the room when the chips are (re)divvied up, you have to trust someone else to advocate for you.  And after tolling away for a few years, trading your life for the promise of a better future through being acquired, ultimately you end up in a shitty position.&lt;p&gt;Don&amp;#x27;t be diluted in thinking the founders will &amp;quot;take care of everyone&amp;quot;.&lt;p&gt;Your only leverage in the end is to walk away (and try and blow up the deal or company, if you&amp;#x27;re that critical). And if you do walk and they don&amp;#x27;t stop you and counter offer, you probably weren&amp;#x27;t going to get anything anyway.</text></item><item><author>CPLX</author><text>Well despite the fact that this is very stressful, I would start with the maxim that one should employ Hanlon&amp;#x27;s Razor[0] and not ascribe to malice what can adequately be explained by stupidity.&lt;p&gt;It&amp;#x27;s quite possible, nee probable, that they are just disorganized and genuinely thought you already knew, or that it didn&amp;#x27;t matter, or otherwise were clueless or inexperienced enough to not really understand what had happened.&lt;p&gt;I think it would be a mistake to get into it with them on a war footing. Early stage companies like this make mistakes of this kind all the time, and it&amp;#x27;s not necessarily a sign that the whole ship is doomed. If they have the ability to get revenue and investment and pay salaries and whatnot it&amp;#x27;s possible that there&amp;#x27;s a positive outcome in the future.&lt;p&gt;I would schedule an initial consultation with a lawyer who deals with these kinds of things. Get a referral and schedule an hour or so to go over it with them. They&amp;#x27;ll probably charge you a few hundred bucks, or even waive it if you have a close friend or existing client of theirs refer you.&lt;p&gt;Sit down with a lawyer, bring the docs, and explain what happened and get some sense of the implications. Then approach the founders with the attitude that it must be an administrative mistake or misunderstanding. If they are evasive or otherwise shady that should become clear quickly. If they are genuinely concerned and want to help fix the problem then great. But personally I wouldn&amp;#x27;t blow up your relationship with everyone until you have a better idea which of those two scenarios is more descriptive.&lt;p&gt;[0] &lt;a href=&quot;http://en.wikipedia.org/wiki/Hanlon&amp;#x27;s_razor&quot; rel=&quot;nofollow&quot;&gt;http:&amp;#x2F;&amp;#x2F;en.wikipedia.org&amp;#x2F;wiki&amp;#x2F;Hanlon&amp;#x27;s_razor&lt;/a&gt;</text></item></parent_chain><comment><author>jnbiche</author><text>&amp;gt; People who always get their revenge tend to have no friends and lots of burned bridges.&lt;p&gt;Walking away from a bad deal isn&amp;#x27;t about getting revenge, it&amp;#x27;s about looking out for yourself (because no one else is).</text></comment>