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by jkaarma
3301 days ago
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With my startup just last week we concluded a deal where one ot he co-founders lost his substantial stake in the company and retained a very small percentage of the company. We've been working on the company full time for a year now. The mistake we made was that we didn't make a shareholder agreement in the beginning when we started out that would clearly outline the responsibilities of each person and what they would have to do in order to keep their equity stake. As the company has evolved it has become clear that one of the founders is holding too much equity compared to the value he is creating for the company. Thanks to our investors we came to an agreement where he was bought out and retained only a small stake in the equity and is staying on part time and there's no bad blood. However if we had created a SHA in the beginning then it would have been very easy now to just legally take away his equity and go forward. So definitely make sure founders' responsibilities are outlined in a legally binding way before you get in business. However from what you're saying I would suggest that you don't get into business in the first place because everything about your company is still ahead basically and if you're getting into with someone who is showing lack of commitment already then it's most likely only gonna get worse in the future. If you own everything about the product already then just take it and walk away. |
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