Frequently Asked Questions

When and why should I determine an initial equity split with my founding team?

Investors expect the founding team to decide on a fair equity split early on. The inability to come to an agreement signals to investors that there could be potential future conflict amongst the team. Alternatively, having this conversation early demonstrates cohesion among the founding team.

It is important for the founding team to think critically about the long-term implications of their initial split. A founding team member holding too much or little ownership in the company can create major headaches and legal costs. The founding team needs an equity split that properly takes into account past, present, and future contributions. For help deciding on an investment-ready equity split, see our co-founder equity split tool.

Last updated on April 2, 2019