Almost every founder split that ends badly traces back to one thing: no founders’ agreement, or one signed too late. By the time roles are blurry and equity feels unfair, the conversation is impossible.
Sign it before you start coding
A founders’ agreement isn’t a sign of distrust — it’s the opposite. Putting expectations in writing while everyone is excited and aligned is what protects the friendship later.
What the agreement must cover
- Equity split & vesting: 4-year vest with a 1-year cliff is standard. Without vesting, a founder can walk after 3 months with 33% of the company.
- Roles & decision rights: who’s the CEO? Who has the final call on hiring, fundraising, product?
- IP assignment: any code or design created in the early days legally belongs to the founder, not the company — until they sign an IP assignment.
- Exit & buyback: what happens if a founder wants to leave, or needs to be removed?
- Dispute resolution: arbitration, mediation, and which jurisdiction governs.
What it shouldn’t do
It shouldn’t replace your SHA with investors. The founders’ agreement governs the internal relationship; once you raise funding, the SHA and AoA become the controlling documents.