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Seedstage Notes

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Startups

Test a Co-Founder Before You Give Equity

Pay a co-founder candidate for a scoped project, run weekly check-ins, and make the equity decision only after you have proof of how you work together.

Illustration: Test a Co-Founder Before You Give Equity

You have a real idea and a plausible co-founder candidate. The hard part is the equity split, not the pitch. The pitch is easier to fake, and the equity split is harder to unwind after the fact. If you are trying to find a startup co-founder, the first step is not a term sheet. Y Combinator runs a website that helps people find potential co-founders. Its checklist includes an in-person trial project before formal commitment. Copy that move: pay the candidate for a scoped project, watch how they execute, and decide on equity only after you have proof.

Set a fixed window and a budget for the work. The aim is not to hire a contractor. It is to create a paid window where both of you can see how you handle deadlines, disagreement, and unfinished work. Compatibility is best judged through extended in-person collaboration, often taking several months. A trial is not a substitute for that, but it can surface the issues that should stop you early.

Pay the trial like a real project

Do not ask the candidate to work free while you test them. Free work changes the power dynamic and hides the real question: can you both be professional when the stakes are low? Put the scope in writing before the initial call. Name the deliverable, the deadline, and what done means. If the project is a page, say what must be finished and who owns it. If it is a prototype, say which screens matter and which do not.

Pay matters because it sets a professional frame and reveals whether the candidate can hold a small commercial relationship. Keep the paperwork simple: a short written agreement with scope, pay, end date, and a note that no equity is granted yet.

  • Lock the scope before work starts.
  • Set a fixed end date and a written stop condition.
  • Agree on pay before work starts.
  • Ask for references from past work relationships.
  • Put a weekly working one-on-one on the calendar.
  • Track decisions, deadlines, and follow-through in a shared doc.
  • Review the work against the scope, not against enthusiasm.
  • Write down red flags as they appear, with examples.
  • Make a final decision: proceed, pause, or stop.

Scope and the end date keep the trial from drifting into a side job. The shared doc gives you evidence instead of memory, and the final decision forces a choice rather than a default split.

Run the week like a working relationship

Keep that check-in separate from project status. Ask how decisions are being made, where friction is showing up, and whether either of you is avoiding a hard conversation. A good co-founder can handle a calm, direct review. A bad fit often shows up in the way they respond to feedback, not in the initial presentation.

Do not ask for a character reference. Ask for examples. How did they handle a missed deadline? Who owned the fix? Did they leave extra work for the next person? Use references to see whether the candidate's story matches the behavior you are about to observe.

Treat red flags as repeated behaviors, not vague impressions: missed deadlines, vague ownership, defensiveness in the check-in, and work that looks good in a presentation but does not hold up in practice. Write down a repeated pattern. Several patterns mean slow the trial. Many mean stop and decide whether the idea is worth that kind of friction.

Make the equity decision in writing

At the end of the trial, make the written decision. Proceed only after you agree on a written equity arrangement with roles and a process for future disputes. Pause only to name the missing evidence and set a short follow-up later. Stop clearly, and pay for the work as agreed.

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