Cofounder Relationship Struggles Are The Most Volatile

May 30, 2014

in Ownership, Starting Up

In the past week I have reconnected with two old friends seasoned in startup experience. Both related stories of cofounder struggles that have been particularly difficult.

These stories are very common. More often than not they stem from poor agreements. I’ve written before about how cofounder vesting is vital. More than 5 years of vesting is ideal.

There needs to be clear delineation of roles and clear pathways for buyout when a cofounder leaves the business. There needs to be empathy, understanding, realism, and practicality in the relationship between cofounders during transitionary periods.

I’m grateful to my cofounders for having these qualities to a wonderful degree. I am grateful we were able to find solutions that were appropriate for the circumstances and balanced in slightly rewarding everyone with some of their expectations while also not giving anyone everything they wanted.

Cofounder agreements typically include understandings about equity, cash, taxes, business spending, personal spending, travel, vacation, roles/titles, and more. They are deeper and more involved than they appear on the surface.

What are your experiences creating a great cofounder agreement?

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