Founders Agreement

A Founders Agreement is a crucial document created when starting a business with one or more co-founders. It clearly defines each founder's responsibilities, equity ownership, decision-making authority, and what happens if a founder leaves the company. The agreement typically includes vesting schedules for equity, intellectual property assignment, non-compete clauses, and dispute resolution mechanisms. It addresses sensitive topics like founder departure, dilution, and compensation before conflicts arise. A well-drafted founders agreement prevents misunderstandings and provides a framework for resolving disputes, making it essential for any startup with multiple founders.