🤝 Co-Founder Agreement Checklist

25 critical topics to discuss before incorporating. Prevent the conflicts that kill 65% of startups.

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Have the Hard Conversations Now

Co-founder disputes are a leading cause of startup failure. These conversations are awkward, but far less painful than a lawsuit or company implosion later.

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Equity & Ownership

The foundation of your partnership

Equity Split

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  • What percentage does each founder get?
  • Is it based on idea contribution, time, or skills?
  • Are you okay with unequal splits?
  • How do you value past contributions vs future work?

Vesting Schedule

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  • 4-year vesting with 1-year cliff is standard
  • Does vesting accelerate on acquisition?
  • What happens to unvested shares if someone leaves?
  • Should there be credit for time already worked?

IP Assignment

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  • All prior relevant IP should be assigned to company
  • Any IP that should remain with an individual?
  • Side projects policy during company time?
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Roles & Responsibilities

Who does what, and who decides

Titles and Roles

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  • Who is CEO? Can this change over time?
  • What are each person's core responsibilities?
  • How do you handle overlapping areas?

Decision Making

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  • What decisions require unanimous consent?
  • Who has final say on product? Hiring? Spending?
  • How do you resolve deadlocks?

Time Commitment

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  • Is everyone full-time? When does that start?
  • Expectations on working hours?
  • Policy on vacations and time off?

Salaries

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  • What salaries (if any) does each founder take?
  • When do salaries start? At what level?
  • How are salary increases decided?
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Exit Scenarios

Plan for what happens if things change

If a Co-Founder Leaves Voluntarily

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  • What happens to their unvested shares?
  • Can the company buy back vested shares?
  • Non-compete and non-solicit terms?
  • How long of a notice period?

If a Co-Founder is Asked to Leave

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  • Under what circumstances can someone be forced out?
  • What's the process (board vote, etc.)?
  • Severance or buyout terms?

Company Sale or Shutdown

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  • At what price would you sell the company?
  • Does everyone need to agree to sell?
  • How do you decide to shut down vs pivot?

Death or Disability

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  • What happens to shares if a founder passes away?
  • Key person insurance?
  • Disability provisions?
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Vision & Values

Make sure you're building the same company

Long-Term Vision

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  • Where do you see this in 5-10 years?
  • Lifestyle business vs unicorn ambitions?
  • What does success look like to each of you?

Fundraising Philosophy

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  • Bootstrapped vs venture-backed?
  • How much dilution are you comfortable with?
  • Revenue-based financing preferences?

Culture & Work Style

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  • Remote vs office? Hybrid?
  • What's the work-life balance expectation?
  • How do you handle conflict and disagreements?
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Legal & Financial

Get the boring stuff right

Entity Structure

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  • Delaware C-Corp is standard for VC-backed startups
  • LLC for bootstrapped/lifestyle businesses?
  • 83(b) elections for founder stock

Initial Funding

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  • How much is each founder contributing?
  • Is early money a loan or equity purchase?
  • Who covers initial expenses?

Expense Policy

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  • What expenses can founders put on the company?
  • Approval process for large purchases?
  • Travel and equipment policies?

📊 Vesting Schedule Calculator

Vested Equity After 12 Months
6.25%

📄 Get the Template

Download a customizable co-founder agreement template (Word doc)