What is a co-founder agreement?
A co-founder agreement is the foundational contract between the founders of a startup that documents the founders’ equity split, vesting schedules, roles and responsibilities, intellectual property assignment, decision-making procedures, departure scenarios (good leaver/bad leaver), confidentiality and dispute resolution.
Founder disputes are a leading cause of early-stage startup failure. A well-drafted co-founder agreement — executed before significant work or investment — substantially reduces ambiguity. The agreement is typically replaced or supplemented by the company’s stockholders’ agreement upon institutional investment.