How to negotiate equity for a side-project turned startup?

Question

Context: I've been working on what started as a side-project with a few really smart and creative folks for around a year. They've recently decided to go full-time on this project since we've honestly created a stellar product and looks like getting funding won't be a big problem for the seed round. Even though I'm super passionate about this project, given the US H1-B regulation and the fact that my day job is sponsoring my green card application, I can't leave my work or even work for another company while being employed by my current employer.Question: So, how do I go about negotiating some equity for all the work I've put in over the past year and what would be a reasonable number to ask?tl;dr Side project is turning into a startup and I can't legally work on it anymore because of visa rules. How do I go about negotiating equity in this startup?

Jugurtha · Accepted Answer

>Side project is turning into a startup and I can't legally work on it anymore because of visa rules.These things drive me nuts. Example: We're in Algeria. We're in the process of hiring an engineer who happens to be Algerian, but is going to move abroad. We work remotely so no biggie, we'll just wire the money in Euros. Nope...The law forbids a company registered in Algeria to pay an employee holding an Algerian citizenship in any other currency than DZD. DZD is unusable anywhere else than in Algeria. You can't transfer it.You know what the bank and accounting firm (big 4) told us ? "the employee could come back once a year to Algeria and withdraw their salary from their local bank account". Are you fucking kidding me ?They also said "if the employee holds another citizenship, you could hire him as a foreigner in an expat capacity".Sometimes you wish legislators and bureaucrats had worked a day in their life in the real world.

version_five · Answer

Could you take an equity stake - commensurate with what you've put in, be an advisor, continue to work on it as a side peoject but not draw salary? Is it a legit argument to say at the time of seed funding you contributed x% so that is your equity, and maybe it dilutes differently than people who continue to work full time on it?