Founder Collaboration Agreement Generator (pre-incorporation)
Founder Collaboration Agreement Generator
Create a legally-sound agreement for co-founders before formal incorporation. Define roles, equity, IP ownership, and more.
Why You Need a Founder Agreement
Explicitly define each founder’s equity percentage, responsibilities, and decision-making authority.
Ensure all intellectual property created for the business is properly assigned and protected.
Set the foundation for future fundraising and transition smoothly to formal incorporation.
Address what happens if a founder leaves or the business needs to pivot or dissolve.
Critical Risk Areas
High Risk: Improper equity allocation is the #1 source of founder disputes. The agreement must clearly define initial ownership percentages that total exactly 100%.
High Risk: Without proper IP assignment, founders might claim ownership of critical business assets if they leave. This can devastate fundraising efforts and valuation.
High Risk: Without vesting, a founder could leave after a month but keep their full equity stake. Industry-standard 4-year vesting with a 1-year cliff protects all parties.
Medium Risk: Undefined or overlapping responsibilities create operational inefficiency and personal friction among founders.
Medium Risk: Lack of clear decision-making protocols leads to deadlock, especially with equal equity splits. Specify which decisions require what level of approval.
How to Use This Generator
Complete All Tabs
Work through each of the 10 information tabs, filling in your specific details. Don’t rush this process – thoughtful answers now prevent problems later.
Review the Risk Evaluation
The final tab provides a color-coded risk assessment of your agreement. Address any red or orange items before finalizing.
Download & Distribute
Download the agreement as a Word document or copy to clipboard. Share with all founders for review before signing.
Legal Review (Recommended)
While this generator creates a solid foundation, having an attorney review the final document provides additional protection and peace of mind.
Sign & Execute
All founders should sign the agreement. Each founder should keep a copy, and digital signatures (via DocuSign or similar) are perfectly valid.
Need Professional Help With Your Founder Agreement?
While this generator creates a solid foundation, complex situations may benefit from personalized legal advice.
Schedule a ConsultationFrequently Asked Questions
The best time is as early as possible – ideally before significant work has been done on the project. The second best time is now. Many co-founders start collaborating informally, but once you’re committed to building something together, formalizing the relationship protects everyone involved. Don’t wait until conflict arises to establish ground rules.
A founder collaboration agreement governs your relationship before formal incorporation. It’s a bridge document that establishes equity splits, roles, IP ownership, and other essential elements while you’re still developing your concept. When you formally incorporate (typically as an LLC or C-Corporation), you’ll create official corporate documents like bylaws, operating agreements, and stock purchase agreements. The terms in your founder collaboration agreement will help guide those formal documents.
Equity splits should reflect both past contributions and expected future contributions. Consider factors like: idea origination, technical expertise, industry connections, capital contributions, full-time commitment, opportunity cost, and risk taken. Equal splits (50/50) are common for two founders who are both fully committed, but don’t default to equal splits without discussion. A dynamic split calculator or “equity pie” discussion is often valuable for teams of 3+ founders. Remember that equity without vesting is dangerous – a founder who leaves early should not retain their full stake.
Vesting is crucial because it aligns incentives and protects committed founders. Without vesting, a founder could leave after a short period but retain their full equity stake – creating a “dead equity” problem that can cripple future funding rounds and demotivate remaining founders. The standard 4-year vesting schedule with a 1-year cliff means that founders earn their equity over time, demonstrating sustained commitment. After one year, 25% of equity vests (the “cliff”), and the remaining 75% vests monthly over the following three years. If a founder leaves before the cliff, they typically retain no equity.
Non-compete enforceability varies significantly by jurisdiction. In California, for example, non-compete provisions are generally unenforceable except in very limited circumstances like the sale of a business. Other states enforce reasonable non-competes, typically those limited in geographic scope, duration (usually 1-2 years maximum), and scope of prohibited activities. If you include non-compete provisions, make them as narrowly tailored as possible. Non-solicitation provisions (preventing founders from poaching customers or employees) are generally more enforceable across jurisdictions than broad competitive restrictions.