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50% of zero is less than 30% of something. If you go under, your valuation will be 0!

This doesn't say anything about whether to take this guy's money. They can still get money from banks, friends, other angel's or get this guy to reduce his terms. Right now, this guy wants to know what are his options.

I am suggesting that an "Avoid the worst" strategy may be superior to "pursue the best" strategy because the absolute value of "the worst" is far inferior to the margin between this (suboptimal) option that he has and an optimal option that we may only imagine.

The only problem with this strategy is that 30% may leave you with nothing as the majority owner drives the company into the ground or fires you prior to vesting. You would be in a worse situation than 0 because you would have invested your time and energy. As entrepreneurs, we all know how demanding a start-up is. To be swindled is just not an acceptable result of effort.

Edit: spelling

Right, i wouldnt give up control until i exited. i assumed two founders bringing in an investor who would take 1/3, so the two colluding founders would still have control.

I think the op mentioned that the investor wants a majority stake. Otherwise, I agree assuming that you know your co-founder well enough that s/he dose not collude with the investor to oust you.

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