Question 1: Imagine you are Vivek Khuller. Should you accept the offer from MSG?
From my point of view, I would not accept MSG’s offer. Instead, I would make a counter offer. The main reason is that MSG didn’t like the deal and proposed a very different deal, which basically wants to control the company and hire all the founders as its employees. And as a founder, I would be very uncomfortable with MSG trying to wrest control from me. In other words, at this stage, I prefer control over wealth.
From the founder’s viewpoint, all of them have a promising future following HBS and working for MSG as their fulltime employee would mean that they would be settling for much less as compared to what they would get otherwise. Also, accepting MSG offer would mean that Smartix will lose the opportunity to shape the culture of their startup, establish their version of fairness and reward philosophy in the company. If they had to work for an organization, why would they settle for MSG, wouldn’t they aim for something more financially rewarding? The MSG offer itself lends to what Smartix can expect in the future from MSG. MSG potentially could hijack the idea, make it a proprietary preventing Smartix from implementing elsewhere, seriously limiting the ability to Smartix team to reap rich dividends later.
Moreover, MSG didn’t like the idea of VC, as MSG considered VC couldn’t bring any value other than money on the table. MSG only cared about minimizing the risks instead of thinking about the upside of the business. This shows discrepancy between the founder’s expectation and MSG’s. Clearly, MSG didn’t see as much potential in the system as I did. This gap in the views could be problematic if we were going to continue working closely together for next several years.
On the other hand, if Vivek came to realization that he cares about potential wealth and do not mind giving up