Pricing & Equity Guide — Reps With Friends

For Alexei. How to price this project and structure the equity conversation with Ben. Written 29 Aug 2026, after the working system exists — that fact changes everything about this negotiation.

1. Where you actually stand

Negotiate from the position the demo creates, not from the position the email implied. Three weeks ago this was "Ben has an idea and a Figma, wants a builder." Today:

• The product exists and works. Engine (98 tests), WhatsApp + Slack bots,<br>a phone-first app with camera verification, heart-rate scoring, seasons,<br>charity pots — and now Ben's own design running as a complete interactive<br>system with a proven engine port (65 screens, 11/11 parity tests).
• Your velocity is demonstrated, not claimed. What a studio would scope<br>as a 3-month discovery-to-MVP, you produced in days. That's the single most<br>persuasive fact you own.
• His design is already integrated. You didn't just take the Figma — you<br>extracted it, analysed it against an independent design, built its component<br>library, and shipped it as a working app. He asked for &quot;a genuine<br>collaborator who takes real ownership, not a pair of hands.&quot; You've<br>pre-delivered exactly that, for free, as a demonstration.

Ben's assets remain real: the idea refined over 18 months, a genuinely excellent 65-screen design, the Silverchair publicity lever, his network, and stated willingness to fund some spend. He is a design-and-vision founder who needs a build-and-systems founder. That's you.

2. What the work is worth in cash (the floor, not the ask)

If this were a qalarc client engagement, priced at AU contractor/agency rates (senior full-stack $900–1,500/day; AI + 3D specialists $1,200–2,000/day):

Remaining to a real pilot (auth, data unification, WhatsApp Cloud migration, legal structure for pots, first crews): call it $60–100k of equivalent work.

Two honest notes: (a) your agent-driven velocity means your actual cost basis is a fraction of this — the number prices the VALUE, not your hours; (b) a pre-revenue startup can't pay this, which is exactly why equity is on the table. Ben said so first.

3. The equity question — frameworks, then numbers

Who brought what (the split logic)

This is a two-founder company where each brought the hard half of a different kind. Splits for that shape, in market practice: 55/45 to 60/40 either direction depending on cash contributed and who's full-time.

The three structures

A. Co-founder (recommended) — you: 35–45%, vesting, full IP consolidation

• Both vest 4 years, 1-year cliff, no exceptions (protects both of you)
• All IP — his Figma/blueprint, your code — assigned to a new company
• You're CTO/co-founder, product decisions shared, his on brand/design/vision
• Little or no cash to you; he funds running costs (they're small: ~$50/mo<br>now, more at pilot)
• Why this shape: his own email asked for exactly this ("owning a smaller<br>share of something worth a lot beats owning all of something worth nothing&quot;,<br>&quot;genuine collaborator… skin in the game&quot;). Offer him the structure he said<br>he wanted.

B. Hybrid — reduced cash + 15–25% equity

• Day rate $700–900 (a visible ~40% discount) through pilot launch, then<br>equity-only
• Equity vests on the same 4/1 schedule
• Suits you if you want cashflow during the build. Costs you roughly half the<br>equity of option A — the discount IS the equity purchase price.

C. Pure vendor — $60–90k phased + 2–5% "sweetener"

• Cleanest, least aligned. He said he'd rather not; you should agree with him.
• Only if the call reveals he actually wants a contractor. Listen for that.

The valuation sanity check (for your own head, not the call)

Pre-revenue, pre-company, with a working product and a credible founder pair: angel-stage valuations for this shape in AU run $500k–$1.5M "paper". Your delivered work ($93–158k equivalent) + remaining build (~$60–100k) is roughly the company's entire technical foundation. At a $1M paper valuation, $150k of contributed work = 15% before any risk premium; at-co-founder risk premium and ongoing commitment is what justifies the 35–45% ask. If he proposes numbers, this is the arithmetic to run in your head.

4. Negotiation guide

Sequencing:

1. Lead with the collaboration, not the number. "The last three weeks were<br>me reading your design properly by building it.&quot; Walk him through the demo.<br>Let him feel ownership of what his design became.
2. Establish the frame: two founders, a company, both with skin. Get his<br>nod on the frame BEFORE discussing percentages — a percentage inside the<br>vendor frame (10%) and inside the co-founder frame (40%) are different<br>conversations.
3. Then the number. Anchor at 40–45% (top of the fair range), settle<br>happily at 35%. Below 25% with full-time commitment and this much delivered<br>work = underpriced; counter with the hybrid (B) instead of accepting.
4. Then terms (below). Terms matter as much as points.

Non-negotiables (your red lines):

• 4-year vesting with 1-year cliff, both founders — his idea included
• IP assignment of the Figma/blueprint into the company (if his design<br>stays personally owned, your code shouldn't be transferred either — but<br>that's a broken company, so just get consolidation)
• Written down: a 2–3 page founders' agreement before the next big build phase
• No equity that vests without the cliff (an investor will retro-fix it<br>painfully later)

Watch-fors:

• "Equity in place of SOME of the spend" — that's vendor+bonus language.<br>Redirect: &quot;if I'm carrying the technical founder load, the split should<br>reflect that, and my cash needs can be small.&quot;
• A 51/49 "so he keeps control" — 55/60-40 with vesting is normal; 51/49 with<br>no cliff means you're an employee with points. Counter: equal board/veto on<br>major decisions regardless of split.
• Valuing his "idea + Figma" above everything — the design is genuinely<br>excellent and worth real founder credit. It is not worth 80%.

If he says no equity at all: the work prices at §2; pilot completion is $60–90k phased; you stay friendly and take it or leave it on cashflow merit.

5. Terms checklist (the founders' agreement)

• [ ] Equity split + 4y/1y cliff vesting, both founders, double-trigger<br>acceleration on acquisition
• [ ] IP: his Figma + blueprint, your code, all assigned to the company
• [ ] Roles: he = CEO/product/design/vision; you = CTO/build/systems
• [ ] Decision rights: day-to-day own lanes; major decisions (raise, sale,<br>pivot, spend &gt; $X) joint
• [ ] Cash: he funds running costs + any agreed part-time rates; amounts in<br>writing
• [ ] Your existing infrastructure (Qalarc Hub etc.) licensed to the company,<br>not transferred — protects your other properties
• [ ] Full-time commitment triggers/expectations for both
• [ ] Leavers: unvested returns to the pool; good-leaver/bad-leaver basics

6. For the call (extends docs/09_CALL_PREP)

Order of the equity minute: frame (two founders) → demo as evidence of the collaboration working → the four structural product questions from the Figma analysis (fairness model, platform, rhythm, power-ups — decide TOGETHER, it sets the co-founder tone) → split + terms → agreement to have the founders' agreement drafted within a fortnight.

One sentence worth saying out loud: "I've already made my bet — the last three weeks are it. Now we just make the paperwork match."

UPDATE — 2 Sep 2026: the negotiation landed

Agreed commercial frame (this supersedes the pure-vendor option for now):

• AU$2,500 total for the pilot-ready system — deposit on signing, balance tied<br>to early deliverables and pilot acceptance (the full schedule lives in<br><code>docs/RWF_Contract_Scope.pdf</code>)
• Early deliverables structure: M1 state unification + auth + Android shell<br>(week 1) → M2 always-on bots + Beeper + hardened verification (weeks 2–3) →<br>PILOT 3 real crews with the five product decisions implemented per Ben's calls
• The equity conversation stays open and separate — the contract<br>acknowledges it in one line; the $2,500 prices the <em>pilot completion</em>, not<br>the venture. Per §2 above, delivered value is $93–158k equivalent — this fee<br>is a token of commitment both ways, which is exactly its function.
• Change requests beyond scope: swap free / small items priced / large items<br>deferred to the equity conversation (the ladder is in the contract §4)

Read this with: docs/RWF_Contract_Scope.pdf (the agreement itself) · docs/RWF_Followup_Deck.pdf (what Ben sees) · docs/24_GAME_DESIGN.md (what the money buys).