What to do in an equity disagreement in a startup
dkokelley: Don't look at it as losing 4%. Look at it as you are losing 20% of your stake (4/20). Are you willing to leave 20% of what you were originally supposed to receive to Austin?Another point to consider: In the end, 4% worth of equity won't make or break anyone (unless it tips the balance of power), seeing as if the company is successful you will all be "rich" in some sense. The issue is not 4%, but working with someone who demands it, and demands it from you only it appears.Why is Michael ok with Austin getting more than he is? Was the startup all Austin's idea? Did Austin contribute more? Is it all a seniority thing (Austin was there first, then Michael, then you)? Also, you never specified what Michael and the Angel's shares were. I'm assuming that the Angel got 40% while the three founders originally planned for 20% each.I would stand my ground and say I was working for 20% + stipend and that's what I expect AND now that it was threatened I want it in writing before moving forward. It should take the 3 of you no more than 30 minutes to have a meeting to agree on it and write up a simple contract for each of you. Then again, contracts can be messy and you should cover your bases (what work is required of each of you, how long the contract is good for - until incorporation when a final contract is created I would imagine - and what happens is someone doesn't deliver). Sorry if that sounds like conflicting advice. Get a lawyer.