Document Founder Agreements Early & Often
I just read this post by David Cohen on the Colorado Startups blog about “boomerang founders.” It’s a nice post on the hazards of flying loose with founder agreements in the early days (think ConnectU lawsuit against Facebook). Cohen writes:
The moral of the story: Early on, if you can afford it, do things right. Find strong legal council, and properly document the company early on. Have a founders agreement. If you can’t afford this then make very simple, clear, plain English, written, signed agreements with you “co-founders”. Keep them simple, and keep physical copies. Make sure you include a basic form of vesting. If you eject or lose a founder, document that previous agreements are null and void, and that they waive all rights to the company and the intellectual property. If they won’t sign it, write down something that they will sign.