Need advice / opinion - joining friends mobile games company
Hi guys
I'm about to make huge decision in my life and have mixed feelings on what I'm about to do.
I would appreciate if you could share your opinions / advises if you've been in similar situation or if you have strong understanding of how mobile games companies operate.
If you have no experience / idea about this business and just want to share your opinion, please take a second and ask yourself if it's going to add anything meaningful.
Just to make it clear - My friend is ok with me asking those questions (what I highly appreciate) as long his / company identity is not going to be compromised.
Facts:
What friend of mine brings to the table:
What I'm bringing in to the table:
What I'm being offered:
Experience Phase
2.2.1 During the Experience Phase (3 months), the time You work should be logged with a time tracking tool such as https://www.toggl.com/.
2.2.2 This agreement can be terminated by either party within 5 days notice during the Experience Phase.
2.2.3 The Company has the option of buying the Works contributed by you at USD 30 per hour in case this agreement is terminated during the Experience Phase.
Equity Earning Phase
2.3.1 During the Equity Earning Phase (and in case it is reached) you will be earning the equivalent of 5% of the Company’s shares split and distributed along 12 months. In other words, at the end of each calendar month you will have earned 5/12% of the company’s shares.
2.3.2 During the Equity Earning Phase, the company may or may not be able to afford extra payments for your working hours, depending on its financial situation. If during the Equity Earning Phase no such payments are made, nothing is owed by the Company to You.
2.3.3 In case You terminate this contract within the first 12 months, the Company has the option of buying your shares earned so far back at GBP 3000 per shares earned per month (5/12%).
2.3.4 In case the Company terminates this contract within the first 12 months, has the option of buying your shares at the value of 5 times your shares earnings in the first 24 months and 10 times your shares earnings thereafter.
2.3.4.1 In case the value computed in 2.3.4 does not exceed GBP 3000 per your shares earned by month, you are have the option not to sell them.
2.3.6 This agreement terminates automatically at the end of the Equity Earning Phase. At the end of this phase a new agreement needs to be made between the two parties prior to continued collaboration.
Whenever the company can afford, I will receive an Art Director Salary.
Whenever it's a good time to, the company will issue dividends.
Like I mentioned on the beginning, I have mixed feeling about this but I'm not going to point out what I'm concerned about - to not bias your opinions.
Please let me know what do you think about this deal ?
Thanks
I'm about to make huge decision in my life and have mixed feelings on what I'm about to do.
I would appreciate if you could share your opinions / advises if you've been in similar situation or if you have strong understanding of how mobile games companies operate.
If you have no experience / idea about this business and just want to share your opinion, please take a second and ask yourself if it's going to add anything meaningful.
Just to make it clear - My friend is ok with me asking those questions (what I highly appreciate) as long his / company identity is not going to be compromised.
Facts:
- Friend of mine asked me to join him in his small mobiles games company.
- Currently he is working on tower defence type of game and hire few contractors for various tasks.
- He is an experienced programmer and good friend.
What friend of mine brings to the table:
- A product that's in the final stretch before being released and already has a live test case which already demonstrates great LTV on iOS. The complexity of the product including server backend, fraud/hack prevention, encryption, messaging systems, scalability, performance tuning, user retention improvements that have already been done.
- He has almost 4 years of experience in the mobile market and this is his third company - so he brings a reasonable experience and failure history (i.e. what not to do) under his belt.
- Strong possibility of being featured at Apple and Microsoft
- Investment that he made so far (almost $ 20 k)
What I'm bringing in to the table:
- I'm highly skilled senior 3D artist working for one of the top AAA studios (over 8 years in the industry).
- Management experience
- Re-doing (and leading other artists) existing environment art (which is not great)
- Creating - icons, marketing materials, splash screen, particles, tweak materials and re-render the characters if necessary.
What I'm being offered:
Experience Phase
2.2.1 During the Experience Phase (3 months), the time You work should be logged with a time tracking tool such as https://www.toggl.com/.
2.2.2 This agreement can be terminated by either party within 5 days notice during the Experience Phase.
2.2.3 The Company has the option of buying the Works contributed by you at USD 30 per hour in case this agreement is terminated during the Experience Phase.
Equity Earning Phase
2.3.1 During the Equity Earning Phase (and in case it is reached) you will be earning the equivalent of 5% of the Company’s shares split and distributed along 12 months. In other words, at the end of each calendar month you will have earned 5/12% of the company’s shares.
2.3.2 During the Equity Earning Phase, the company may or may not be able to afford extra payments for your working hours, depending on its financial situation. If during the Equity Earning Phase no such payments are made, nothing is owed by the Company to You.
2.3.3 In case You terminate this contract within the first 12 months, the Company has the option of buying your shares earned so far back at GBP 3000 per shares earned per month (5/12%).
2.3.4 In case the Company terminates this contract within the first 12 months, has the option of buying your shares at the value of 5 times your shares earnings in the first 24 months and 10 times your shares earnings thereafter.
2.3.4.1 In case the value computed in 2.3.4 does not exceed GBP 3000 per your shares earned by month, you are have the option not to sell them.
2.3.6 This agreement terminates automatically at the end of the Equity Earning Phase. At the end of this phase a new agreement needs to be made between the two parties prior to continued collaboration.
Whenever the company can afford, I will receive an Art Director Salary.
Whenever it's a good time to, the company will issue dividends.
Like I mentioned on the beginning, I have mixed feeling about this but I'm not going to point out what I'm concerned about - to not bias your opinions.
Please let me know what do you think about this deal ?
Thanks
Replies
Well without knowing your reasons as to why you are concerned it's difficult to give any advice.
Generally speaking I would say why not, give it a try will definitely be a experience either way.
In the worst scenario (with contract in the current shape and form) I could end up in bad position.
In best scenario - I don't feel that rewards are big enough to take this risk.
Hope this clarifies it a bit.
On every decysion you make there is plenty personal factors + your own ego and that can shift your decysion in one or another direction.
I like to hear different opinions from people who see the problem from different perspective than I do.
Then they offer you shares, which could be valuable, or could be worth nothing. But either way, it seems the company has all of the buyout control and is safeguarded, whereas you aren't.
There's no definition in that clause.
I'm all for hobby projects with a royalty split at the end, but this isn't the way to go with full time work unless you have a lot of savings to lean on and you're absolutely positive the company is going to take off.
TLDR version: A cat for a hat, or a hat for a cat. But nothing for nothing.
It's a cop out. If he wants your skills then he can pay the 9 till 5 for them like any other company. If he can't, do you really want to be in the situation where all you have are empty promises to fill your stomach?
The wording heavily suggests lack of trust or follow through. What are these project expectations? Why is a 8 year professional even contemplating stringing himself up for 3 months+ with no work security. You literally have no power what so ever. He get what he wants after two months and can toss you aside. Friend or not. This is business and you need greater security than that.
Are the share even worth 3k? or is that just hot air? (says upto 3k) Could be worth a few £...
Also last point, you shouldn't shy away with discussing contracts opening. They have no legal right whatsoever to stop you discussing your contract and or pay. You don't even have to ask permission. I've learnt this the hard way when i was royally screwed by a single word that i over looked and got less than %50 of what i was expecting.
So yeah. Forget he's your friend, get a full, printed copy of the contract and go to a lawyer/solicitor and discuss it.
http://vimeo.com/22053820
Watch that
Paying for a professional who knows these things, earns and saves you money. Simple as that.
I simply need change in my life and I'm in the position (right now) where I can afford a bit of risk. I consider 3 options:
This is your best-case scenario?
Btw, I have this motorcycle that I'm selling for $5k. Worst case scenario, you get it to run and engine catches fire and the chain snaps which gashes your calf to mince meat
Best case scenario... it doesn't run at all
(edit:: Avoid making huge life changes with a poor R.O.I.)