founder equity split

Vesting Schedule

Time acts as the primary currency that transforms a promise of equity into permanent ownership over a multi-year horizon. Builders earn their allocations incrementally through continuous service rather than receiving the full block on day one. A standard cliff period requires twelve months of uninterrupted work before the first tranche of shares transfers to the individual.

Accelerated provisions sometimes apply when an external buyer acquires the entire corporation, transferring unvested shares immediately upon the closing of the transaction.

Contribution Valuation

Assessing unequal inputs requires translating disparate sacrifices into a common metric of capital and capacity. An individual who writes early cheques or writes proprietary code claims a larger initial slice than a partner who joins later with identical operational hours. Disputes arise when participants measure their own inputs by future potential rather than historical delivery.

Time spent on preliminary research holds a lower monetary value than time spent managing paying clients once operations begin.

Resignation Mechanism

Departure triggers a distinct sequence where the departing builder retains vested shares while surrendering all unvested portions back to the treasury. The remaining participants absorb the returned shares proportionally or hold them for future executive hires. A departing founder keeps ownership without continuing labour, creating friction for those who remain inside the daily operations.

This structural split determines who bears the financial risk when the primary architects of an enterprise walk away from the table before the product reaches the market.