Perhaps the most painful part of any business relationship is dividing up the cake between partners. This usually happens in the very early days of a new project, when there is a handful of you in a room, a band of adventurers with big dreams out to conquer the world. So what shareholding does everyone get?
The easiest split is to give everyone an equal stake. This has a certain simple logic. Usually,
first-time start-up teams, and friends or relatives who go into business together, do it this way. In my experience this tends to lead to fewer arguments initially but it rarely reflects relative contributions – more naivety and a spirit of fairness. It does not really work with more than three founders – and it can certainly lead to bitterness later, if some feel they were cheated or that others have not pulled their weight.