Founder Agreement Checklist

Key Clauses for Your Founders' Agreement

A well-drafted founders' agreement is the most important legal document for an early-stage startup. It's the "pre-nup" for your business partnership and prevents future disputes. Ensure it covers these critical areas.

Equity & Ownership

• Equity Split: A clear, unambiguous statement of the shareholding percentage for each co-founder.
• Vesting Schedule: A 4-year vesting schedule with a 1-year cliff is essential. This protects the company if a founder leaves early.
• IP Assignment: A clause stating that all intellectual property created by the founders related to the business is owned by the company, not the individuals.

Governance & Control

• Roles and Responsibilities: Clearly defined roles for each founder (e.g., CEO, CTO) to avoid turf wars.
• Decision Making: Define which decisions require a unanimous vote versus a simple majority.

Exit & Contingency

• Founder Departure: What happens to vested and unvested shares if a founder resigns or is terminated? Does the company have a right to buy back the shares?
• Deadlock Resolution: A mechanism to resolve disputes if the founders reach a 50/50 impasse.