method candidate goes to: this-edition T town planner
Sell, don't issue: the investor buys the founder's shares, the founder lends the company what it needs, and nobody buys the steering wheel
For a founder who has already won (paying customers, profit, growth, more than one investor who wants in): instead of the company issuing new shares, the investor buys ordinary shares the founder already owns, in a private sale, so the founder is paid now for years of underpaid work, the company is not diluted, and no board seat, veto or liquidation preference comes with the money. If the company needs cash, the founder lends part of the proceeds back, subordinated by contract to every other creditor, at a modest fixed rate or none, repaid if the company succeeds. A founder lending their own money watches every penny, and 74% of high-growth internet startups fail from premature scaling. The investor's insurance is not control but the fork: with everything open source, if the founder goes wrong they can take the code and back a better service.
Decided by. Nobody yet: a candidate for Dinis to read, comment on and decide (keep, rewrite, merge, cut, article first, later, not doing it).
Note. The worked example, illustrative: a UK company worth £10 million, £2 million invested, the founder keeps 80% either way; in the sale the founder pays about £420,000 in tax (18% on the first £1 million under Business Asset Disposal Relief from 6 April 2026, 24% above) and has about £1.58 million, lends £0.75 million and keeps about £0.83 million; the buyer pays 0.5% stamp duty. The article says no study tests the model, the fork as insurance is an argument not a tested mechanism, it is not tax or legal advice, and Dinis has a stake. The fork is slow both ways: three months at best, closer to a year, for an established company to reach where the original team is.
Where it comes from
- Sell, don't issue Sell, don't issue; Lend, don't dilute; The open source safety valve; Why it could raise the odds; A worked example (newsroom)
What it answers in the 2018 book
- Be a founder answered written, Life Patterns
- Open Source answered written, MVP for Gen Z Dev
Where it goes
Chapter Fund it, or do not, part Start the company (drafting); topic Be a founder (or a one-person service).
Other ideas proposed for the same chapter: Fund it, or do not: the worst time to raise is before you are profitable, and the best is when they call you, We study survivors: a risky practice can look like the cause of success when only winners are counted, Investors select for the founder they can steer; control is written into the contract, and founders get replaced, What breaks: EIS is lost on bought shares, a big early sale reads as doubt, the founder-lender is a creditor, and a broad non-compete closes the fork, Europe's slower, sceptical money suits a founder who can build first.
Node idea:sell-dont-issue in graph.json; see it in the graph. Source: admin/content/graph/ideas.json.