Equity Not the Only Option for Software Start-Ups Hiring First Developer

Silicon Valley entrepreneurs have a tendency to want to offer equity to anyone who they hire when they are first getting off the ground, and some developers prefer to receive equity in the business over an IOU that they may or may not be able to collect on.

However, when an entrepreneur calls me saying that he or she wants to offer equity to a developer he or she barely knows but wants to bring on board for the project, I always suggest that he or she consider another option: a collaboration relationship.

In my recent posting to the Silicon Valley IP Licensing Law Blog, I explained why collaboration agreements should be contemplated by many software start-ups hiring their first developer.

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Kristie Prinz
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