Future commitment
Compare expected time, the path to full-time work, financial opportunity cost, and the duration each founder expects to remain involved.
Founder equity guide
Split founder equity around future contribution, not emotion
Use a transparent framework to surface assumptions, compare responsibilities, and prepare an ownership discussion with professional advisers.
Updated
Build the right context
An equity split is a forecast about the work ahead
Early founders often overvalue the original idea or the first few months of work. Most company value is created later through execution, learning, hiring, customers, capital, and resilience. The split should reflect the partnership you intend to build, not only the story of how it began.
There is no universally correct percentage. A useful process combines structured factors with honest judgment, then uses vesting and written agreements to handle uncertainty. Avoid false mathematical precision: a calculator can organise a conversation, but it cannot make the decision for you.
Ownership and risk
Consider the importance of each operating domain, personal guarantees or cash invested, reputational exposure, and responsibility for difficult company outcomes.
Prior contribution
Value validated customer learning, usable IP, revenue, contracts, or capital carefully. Distinguish company assets from effort that did not create transferable value.
Search focus
Topics to put in writing
- Time commitment and start date
- Role scope and decision authority
- Relevant skills and replaceability
- Cash or assets contributed
Team coverage
Questions to resolve together
- Customer evidence and traction
- Salary deferral and opportunity cost
- Future hiring and dilution
- Vesting and departure treatment
A repeatable framework
A fair equity discussion process
Use evidence from shared work to make the partnership decision. Profiles and interviews begin the process; they should not replace it.
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01
Score factors separately
Each founder should independently assess commitment, ownership, contribution, risk, and prior value before comparing results.
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02
Explain the reasoning
Discuss why scores differ. The disagreement often reveals mismatched role expectations or hidden assumptions more usefully than the final percentage.
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03
Model future scenarios
Consider fundraising dilution, employee options, a founder leaving, delayed full-time commitment, and changes in responsibility.
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04
Document and review
Obtain legal and tax advice, implement vesting correctly, record approvals, and update documents when circumstances materially change.
Due diligence
Use this founder conversation checklist
Write down important answers and revisit them after a trial project. The purpose is to identify assumptions, not to force agreement where meaningful differences exist.
Try the co-founder compatibility test- Time commitment and start date
- Role scope and decision authority
- Relevant skills and replaceability
- Cash or assets contributed
- Customer evidence and traction
- Salary deferral and opportunity cost
- Future hiring and dilution
- Vesting and departure treatment
Before the formal agreement
Write a one-page founder operating agreement
This is not a substitute for legal documents. It is a practical record of how you intend to work while the relationship is still being tested and the company structure is being prepared.
Decision domains
Name the decisions each founder can make independently, decisions requiring consultation, and decisions requiring unanimous approval.
Working cadence
Agree on weekly hours, core meetings, written updates, customer contact, location, response expectations, and how absences are communicated.
Money and expenses
Record current contributions, expense approval, salary expectations, financial runway, fundraising appetite, and when commitments will be reviewed.
Conflict and escalation
Define how disagreement is documented, when an external adviser is involved, and which behaviours are unacceptable even under pressure.
Confidentiality and work
Clarify confidential information, pre-existing work, ownership of trial outputs, third-party obligations, and records that must be maintained.
Pause or departure
Discuss what happens if commitment changes, a trial is stopped, someone accepts another role, or the founders decide not to continue.
After you decide to continue
The first 90 days as a founding team
Move from relationship testing to company evidence without losing the habits that made the trial useful. Keep responsibilities explicit and review the partnership alongside customer and product progress.
- Days 1-30
Align the foundation
Define the customer, riskiest assumptions, founder domains, meeting cadence, cash position, legal work, and one measurable milestone.
- Days 31-60
Create market evidence
Run customer, product, technical, or distribution experiments. Track decisions and distinguish strong behaviour from encouraging opinions.
- Days 61-90
Review the company and team
Assess evidence, pace, quality, finances, ownership balance, unresolved conflict, and whether the next quarter deserves greater commitment.
Common questions
Make the next decision with more context
Should co-founders split equity equally?
Equal splits can be reasonable when founders have comparable commitment, risk, responsibility, and expected contribution. Unequal splits can also be fair. The quality of the reasoning and protective structure matters more than a universal rule.
How much equity is an idea worth?
An unvalidated idea alone rarely determines a durable split. Evaluate customer evidence, transferable IP, progress, and the much larger body of future work required to build the company.
What is founder vesting?
Vesting makes ownership conditional on continued service or agreed milestones. Structures vary and can have legal and tax consequences, so founders should obtain tailored professional advice.
Can we change the split later?
Changes may be possible with the required agreements, approvals, compliance, and tax consideration. It is usually easier to establish a thoughtful structure early than to renegotiate after value and tension increase.
Start with a clear founder profile
Meet people who can evaluate the opportunity with you.
Share your strengths, startup context, and the ownership gap you want a co-founder to fill.
Create your profile