Marco is very clear about it here:

https://twitter.com/marcoarment/status/335483318311194624

and it doesn't sound like he harbors any ill will, regret, bad feelings, negativity, or insult by the distinction.

Interesting question - would you rather be a cofounder with 5% equity or an employee with 6% equity. (In the tumblr case, worth about $10mm more).

Given that most (everyone?) would rather be the employee with 6% equity, it brings into focus what's really important at the end of the day.

All else equal, the founder/cofounder label might be worth something to the ego, but, having been one of 100 or so "founders" of Opsware, and also having worked at a company where the "Founding CEO" joined almost a year after I did, I've grown to recognize that "Founder" is nothing more than a label, doesn't really signify that much.

Total Compensation Package (inclusive of equity) is what's important.

[Edit: I guess some people might consider "Founder' of a successful company to be a proxy for their reputation, and reputation is very, very important, as it can be leveraged during salary negotiations, or, raising money/hiring. So, from that perspective, being known as the "Co-Founder of Tumblr" might be relevant]

I see an analogy to the "Vice President" label in big companies.

"Founder" is very different from "early employee". Being called an employee, when that's what you are, isn't an insult.

The word, "Founder" - isn't really black and white.

Simply drawing a salary doesn't mean you aren't a founder - the vast number of founders of companies I know of in the valley draw a salary. Not investing money, also, doesn't mean you aren't a founder.

My definition of a founder? Someone who's idea's shaped what the company would be, who started work on the project prior to there being an actual company, brought a lot to the table (whether that is engineering, marketing, money, leadership) that made the company successful, and had an equity stake in the company.

In Marco's case, all four are true. He was there before tumblr existed, helped shape what tumblr would do, did much of the engineering that made tumblr what it is today, and he had an equity stake. He could reasonably be called a founder.

With that said, being known as a "Founder" is also subject to negotiation, and sometimes an employee can come on up to a year after the company is started, invest no money, but still be called a "Founder." It's really quite nebulous.