Should I make this early employee a co-founder?

Like some people say: Don't be cheap with equity. Especially if these people are at the core of your success. They will be even more committed to the cause.

Absolutely not, unless there is some major benefit. Maybe equity as part of salary if it is needed to keep them on long term.

OP here --

Seriously? Two different conflicting opinions?

Someone else please chime in asap because I'm defining corporate terms Thursday.

Can you do without these people ? Consider the time lost (6 months , 1 year or more ) if they left and you find someone to fill the gap.

Startup is like a aircraft taking off , if you are at the end of the runway about to take off, don't stop to let the co-staff get off . You might be not in a position to taxi again and reach this stage again. Worst is if someone else takes off before you.

Finally , attitude means a lot. Both yours and your would be co-founders. If they have so selflessly rallied around you without any promises then I would not blink twice before giving them equity. You can size it differently based on their input and relative value. Hope this helps and would be keen to hear how it goes.

You should pay your best team members well. But in which "currency" ?: it can be in salary, in stocks, in nice words - or a mix of it. They already got paid for their past work, so give away shares only linked with future events, like reaching FUTURE mile stones. Or give them a raise of 10%, paid in stocks. If you continually pay with a bit of equity: fine. If you just give away 20% of your equity right now, in one go, then actually this is an invitation to quit, since they will never get more in one single month.