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Kush Katara
I Help Start-up Foun... • 1d
When friends become co-founders, the toughest talk is the one about what happens if someone leaves. Whenever I meet early stage founder's specially Student founders registering their first company, I give them one simple but very important piece of advice: Prepare a cofounder agreement & Add a Reverse Vesting Clause. In the beginning, everyone’s excited. No one wants to discuss what could go wrong. But six months later, one founder gets a job offer, another loses motivation, and one is left doing all the work. That’s when this clause saves the Startup. What it means? If a founder quits early, they return the unearned shares to the company. It ensures ownership stays with the ones still building. For Example: If you own 25% shares and the vesting period is 4 years, you earn 6.25% every year. Quit after one year, you keep only that. The rest goes back. Without this clause, the person who left still owns a big stake of your startup, without doing any work. Reverse Vesting Is not a sign of mistrust. It’s a sign of Maturity. What according to you is the one thing every early stage startup must do before registering their company? #startups #founders #studentfounders #entrepreneurship #startupindia #reversevesting #founderlessons #buildingstartups
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