Ask HN: How should I structure a simple co-founder agreement?

4 pointsjeffrese8y ago4 comments

I recently brought on a co-founder. I offered a salary and 15% equity with a one year cliff and a four year vest. I have not raised outside funds.

I'm thinking I write a simple document stating 15% equity with a one year cliff and a four year vest and we both sign it and hold a copy.

I'm thinking this will work to cover us both legally until the time of a funding event when we can have lawyers draw up something more official.

Will the simple letter suffice or should I go the lawyer route now?

4 comments

codegeek8y ago

Go the lawyer route now. Even if it is not a very expensive lawyer, get a lawyer to draft the agreement. If you do it yourself, you just don't know what things you are missing.

It is not just about funding. What if you start growing without funding and then suddenly you realize you don't have a solid agreement in place. It could be too late by then.

I hate lawyers but they are a necessary evil because when shit hits the fan, you will need one anyway. If shit never hits the fan, good for you and that is the price you pay for hoping shit doesn't hit the fan.

jeffreseOP8y ago

Thanks, I will.

staticautomatic8y ago

Absolutely go the lawyer route. The downside risk of doing it yourself is too high.

jeffreseOP8y ago

Thank you!

j / k navigate · click thread line to collapse

Ask HN: How should I structure a simple co-founder agreement?

4 pointsjeffrese8y ago4 comments

I recently brought on a co-founder. I offered a salary and 15% equity with a one year cliff and a four year vest. I have not raised outside funds.

I'm thinking I write a simple document stating 15% equity with a one year cliff and a four year vest and we both sign it and hold a copy.

I'm thinking this will work to cover us both legally until the time of a funding event when we can have lawyers draw up something more official.

Will the simple letter suffice or should I go the lawyer route now?

4 comments

codegeek8y ago

Go the lawyer route now. Even if it is not a very expensive lawyer, get a lawyer to draft the agreement. If you do it yourself, you just don't know what things you are missing.

It is not just about funding. What if you start growing without funding and then suddenly you realize you don't have a solid agreement in place. It could be too late by then.

jeffreseOP8y ago

Thanks, I will.

staticautomatic8y ago

Absolutely go the lawyer route. The downside risk of doing it yourself is too high.

jeffreseOP8y ago

Thank you!

j / k navigate · click thread line to collapse