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I've recently joined a startup. (I'm one of the first "employees", but not a founder). At the start, I was asked if I would like to work for money or for shares; I chose shares over money, because money was not an issue for me then. The founder, however, mentioned to pay a small bonus (of about $100) to all employees regardless of the contract we signed when the first (and then subsequent) stage of the project is completed. We have since then completed the project's first stage, but there hasn't been any mention of the bonus since. The shares contract I signed is very detailed, but it also doesn't conatain a word about the bonus.

The startup is very small and more like a group of friends than an actual workplace - however compensation has always been discussed individually and with proper privacy. I'm also not good at negotiating and talking about money in general. I'm also afraid that by asking I will mess up the management's attitude towards me. I do not want to come off as greedy - I've been viewing my participation in this project as "having fun" instead of "having to work", but I did so with full enthusiasm and dedication and I am convinced I actually did quality work and deserve the promised bonus.

Should I mention the issue? If yes, how? Please note I live in Hungary.

  • The founder mentioned to pay a small bonus (of about $100) to all employees was this done publicly (i.e. announced to the entire company) or something you were told in private? – ExactaBox Jan 20 '15 at 2:19
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    $100 is in any part of the world not a bonus, but pocketchange for a technology startup. Even in a country with low wages, this will be only a very, very small fraction of actual wages for an employee. No-one will see you as greedy, but it also isn't something to make a fuzz about. Just ask it casually and remind the founders of their promise. – Reinstate Monica - dirkk Jan 20 '15 at 13:41
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    Has this start up made a dollar yet? Has anyone else taken money out of the company? If I were working in a pre-revenue company, living off savings, and I heard a co-worker wanted $100, I would kick them out the door. Shouldn't you be focused on doing all you can to make the business a success, not pull a measly $100 out of it, which risks others wanting to do the same? That's my take if you are living in the US. – jmabs Jan 21 '15 at 6:57
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    @jferr:So how much money does it take to turn from measly into enough to ask about when promised? Apparently $100 wasn't so measly to the manager that the manager didn't bother to mention it. There have been times in my career where I have had to "remind" my manager of comments that they made. Each time they had forgotten and thanked me for reminding them. $100 might be measly to you but if the OP were to use it to take someone special on a nice dinner date then that "measly" could turn out to be quite a night. – Dunk Jan 21 '15 at 21:08
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    No, my life doesn't depend on that $100. For me as a young homeowner, it would mean a nice pair of curtains, a poster or new lighting. Or an SSD so I could code faster and longer. So it isn't absolutely necessary, but it was promised and I've been looking forward to it. If I wanted to get quick money out of this, I wouldn't even have chosen the "shares" contract in the first place. Also, CEO was the one being all about money and contracts, I would have taken part just for the fun and experience. – matega Jan 21 '15 at 22:59
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Should I mention the issue? If yes, how?

Yes.

Approach your friend in private and ask something like "Hey, boss - remember that bonus you talked about giving us once the web prototype was completed? Well, it's completed now!"

Keep it light and friendly, and you'll likely get a friendly response. It's unlikely to mess up management's attitude towards you.

  • You could be much more subtle and make a small joke out of it, giving both parties a chance to take it lightly. If this doesn't work you can always still up the game, but the casual approach creates less tention. – Martijn Jan 21 '15 at 12:47
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You should start the conversation and you can ask the following questions:

  1. Clarify the proposal and the conditions: Was it 100$? What should have happened for you to get that bonus?

  2. What is the current status of the project which was connected to the bonus? Is it closed? If YES, when do you get the bonus? If NO, what do you need to do in order to close it.

You can run into an answer: "I do not recall any talks about a bonus." Then you will have a bigger problem, the founder does not stand for his words and you should look to move on.

For your own comfort, in order to avoid coming of as greedy, always address the facts: There is a project, and there is an agreement. A valuable partner will appreciate you standing up for yourself and being sharp about your rights. The founder has done it himself when he has set up a clear and specific contract, in spite of the nice friendly attitude towards work.

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Knowing what you have commented in response to my questions, I'll give you my advice.

You are a full time medical student living in the US and involved in a small technology website/application startup, which is largely, if not mostly, managed and owned by two related people. You have invested your time and talent (but not money, I imagine) in exchange for some amount of equity in the business, and have the verbal promise of a small sum of money from one of the main owners. The business is currently pre-revenue and has not attracted any investments outside the original investors (right?), and it is not believed that it will attract any money for months (which tends to be an optimistic scenario).

If I were one of the founders and you came to me looking for money, I would ask what you need it for. I know medical students to generally be able to put food on the table, but if you are spending tons of time working on my project and can't be tutoring other students, I might recognize that you need some sort of stipend--although not a one-time $100. If you don't have a good reason for the money, then you're putting yourself up for review and depending on your performance and my strategy, I might give you the money or tell you to get lost.

If you think this startup will be successful, don't risk whatever position you have in it over $100. (But don't be surprised if it fails)

  • I live in Hungary, and med students here tend to just come even at the end of month. Otherwise, I still think I'll take your advice and keep silent about the money. Part of it is that I'm a bit frightened by your comment and don't want to get kicked out, another part is that I can manage without it; but if he suddenly decides to give us the bonus, I won't object. – matega Jan 21 '15 at 23:24
  • Hungary! That's a surprise, I assumed that you were in the US by your English. (An aside: 100 USD in Hungary goes about twice as far as it does in the States, so ~200 USD) So take my advice as representative of what I think would happen in the US. Certainly you have a better understanding of the cultural differences between Hungary and the States and should take my advice with that in mind. If you are making ends meet, your about doing the same as US med students. Also, I think only you can gauge how vital you are to the business and if something bad could happen. Not asking seems smart. – jmabs Jan 22 '15 at 1:33
  • " I would ask what you need it for. " I do not expect anyone asking this. If you have a contract, which is the case here, you have to honor it. – Pierre B Jun 24 at 10:37
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Along with jferr's answer:

If you have shares then you should understand that every single dollar taken out of the company is money that is no longer available to be used for something else. In a startup, every single dollar needs to be able to directly return at least it's value, and usually far more, rather quickly.

The question you need to ask yourself, as an owner, is "Should that $100 go into my pocket or should it be used to help generate a sale or otherwise attract investors?"

For example, do you need brochures? If so, $100 buys a decent amount of those. Do you need a website with email? Whoever is in charge of the purse strings needs to ask themselves "Is this absolutely necessary?" and "What value will this add to the company?" If it's either not absolutely necessary and/or it isn't adding value then it shouldn't be spent.


So, rather than dwell on an unwritten broken promise, use this as a learning experience. If one of the founders ever makes a statement or promise for a future payment - whether in cash, shares or whatever - then make sure it's written down. That way everyone is perfectly clear about it.

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