If I do a 49-50 split partnership do I have the final say as the one with 50% equity?


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I just do not know that much about the other person other then he has good tech skills and can take care of a lot of the paper work stuff, that lets me design and build the business. Which is what I do best. Is a 49/50 split fair in this case?

Co-Founder Equity Ownership

asked Jun 30 '15 at 04:59
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Paul Gilchrist
1 point

2 Answers


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It all depends on the terms you put in the founders agreement. There are a few templates on Docracy that you can use.

On a side note, that doesn't sound like a good way to go into a partnership with someone. Having a co-founder is pretty much like marriage. It's a good idea to get to know the person and see if they'll be the right fit.

answered Jun 30 '15 at 05:34
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Nishank Khanna
4,265 points

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Your bylaws, partnership agreement, shareholder agreement, etc. can be crafted to the specific terms of whatever it is you want them to look like. For instance, you can grant someone 50% equity in your company but remove their right to vote on company decisions completely or just grant yourself an additional vote in case of a tie. This can all be customized to whatever the two parties will agree to and what makes the most sense for your business. Consult a good start-up lawyer for this.

Personally, I would rethink the 49% equity unless that person brings something significant to the table that has been verified by past performance. You can hire 3rd parties to handle your "paperwork" and outsource technology needs fairly inexpensively. Think about it this way will this unknown person provide enough value to take half of your paycheck? Is short term cost more important than long term gains? Pay $30k out of pocket today vs. losing 50% of $1million in revenue later on?

If you are set on giving up that much equity, I would recommend creating a vesting schedule based on milestones and time to keep them motivated, performing and reducing risk based on unknowns. Coming on board and first year, 25%, launch of product an additional 10%, after 2 years another 5%, etc..

answered Jul 9 '15 at 13:39
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Scott Richards
81 points

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Co-Founder Equity Ownership