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I want legal agreements in place before I start writing code with a non technical co founder. We've agreed upon a 50/50 equity split.
by _RPM 10y ago
I want legal agreements in place before I start writing code with a non technical co founder. We've agreed upon a 50/50 equity split.
- hberg 10y agoOne reason to incorporate as a C or S-corp is that it's easy to add 4-year vesting to founder shares. This protects you if your co-founder walks away after 6 months. It's much harder (if it's even possible) to vest "shares" in an LLC. In your case of a 50/50 split, make sure your agreements also have a clause that deals with disagreements. IT's likely you'll come to a point in your business where you do not agree and 50/50 ownership can make your business stall. Codify how those disagreements are solved before you get there.
- jahewson 10y agoWrite that fact down on a piece of paper and both sign it. Then get it stamped by a public notary. Right now you're looking to make an agreement, not operate a company. Most likely your only ownable asset for the foreseeable future is copyright, which you can agree to share equally with just a piece of paper - having a business entity won't actually help you unless you have either income or are ready to take on investors.
- throwaway_xx9 10y agoAgreements in a failed partnership/business are worthless. I recommend programmers retain copyright in the software they write (and add a header to each source file) until the other cofounders meet certain tangible milestones, like sales or funding.