Vesting and Founder Agreements

Vesting protects both founders and the company — ensuring equity is earned over time and no one walks away with a large stake early. Founder agreements are essential to outline roles, equity splits, and what happens if things go sideways.

Why it Matters

Founders leave — it happens more than you think. Vesting ensures no one owns a big chunk of equity without contributing long term.

Clear agreements set expectations and reduce conflict if the team splits or pivots.

Founders Checklist

Standard vesting: 4 years with a 1-year cliff
Include in your equity agreements and cap table
Sign a Founder Agreement covering roles, IP, decision-making
Decide on what happens if a founder leaves early
Use legal counsel to draft and review all agreements

Founder Fails

No vesting schedule — founder leaves with 50% equity
No written agreements between founders
Conflicting expectations around roles and time commitment
Not protecting IP contributions from co-founders
Confusing friendship with legal structure

When to ask for Help

You’re forming your founder team and want to split equity fairly
You’re unsure how to set up vesting or legal docs
You’re dealing with a founder who wants to leave or reduce hours
You want to renegotiate terms or add a new co-founder
You need to resolve a conflict between founders

Frequently Asked Questions

Q: Do we really need vesting if we’re close friends?
A: Yes. Vesting protects friendships and business — especially if someone leaves.

Q: What happens if someone leaves before the cliff?
A: They get nothing. That’s the point of the 1-year cliff — to avoid giving equity to those who don’t stick around.

Q: Can we adjust vesting later?
A: Yes — but it requires mutual agreement and legal documentation. It’s easier to do it right from the start.