Founders Agreement

When you want to start a company, it’s you and your co-founder(s) against the world. Sleepless nights, neglecting friendships, cheap food - whatever it takes to build your dream. Without your co-founder(s), you probably wouldn’t get very far. You guys make an awesome team!

Unfortunately, great relationships rarely last forever. It’s important that you make the necessary preparation in case relationships change, work priorities shift, or company disputes arise. Although it’s not bulletproof, thinking carefully about your Founders’ Agreement at the start can help address any potential long term risks.

The content of a Founder’s Agreement can change over time, depending on your company stage, whether or not it’s incorporated, received outside funding etc.

A founders’ agreement is a generic term used for agreements between the co-founders of a company that address the relationships between the co-founders and the co-founders’ rights and responsibilities in the company. Depending on the company’s stage of maturity (and, if it has already been incorporated, its form of incorporation), this agreement could take the form of a shareholders agreement, operating agreement, or just a general founders’ agreement. Regardless of what it is called, the purpose is the same — to ensure that the co-founders are on the same page and to avoid misunderstandings and disputes in the future.