tech start up concerns
June 4, 2012 7:57 PM Subscribe
What should I look for in an employment contract for new startup?
I'm in Toronto. I've been working for a small tech startup since fall last year. The company's bread and butter is software, but I've been heading up a new hardware project. I believe the plan is to eventually spin this hardware project off as a separate division.
We just finished applying for the communitech Hyperdrive accelerator program and we've already file a couple of provisional patents on the work I've been doing the past 6 months, but at the moment this project is not in any way a separate business and hasn't brought any money in.
We're getting to the point where I'm going to assign the IP formally to the parent company and I've mentioned in a friendly way that I'm only comfortable signing over IP once I also have an employment contract in front of me to sign.
For the most part I'm happy with a boiler plate employment contract, although there are a couple of small tweaks I'd like to suggest. One thing that will be an issue is my stake in the company -- I'm basically getting paid peanuts right now, with the understanding that I'll get a stake in the company. Most of the material I've been able to find on employee stock options is very U.S. / silicon valley oriented and I'm not sure how well it translates to Ontario/Canada. There seem to be some fairly esoteric tax implications that are regularly discussed in the US context. I haven't yet found anything that covers a Canadian/Ontario context.
What other things are worth thinking about?
Recommendations for good resources, particularly in the Ontario/Canada context?