Lesson 4: Two founders is the magic number Or 2.09 to be exact, even if it’s statistic drawn from a small, rather dated (but regularly cited) sample. While three can be handy for breaking deadlocks, it also allows two to gang up on one. Theres also less chance for skills and responsibilities to overlap when there are two or even three co-founders. Lesson 5: Beware of the 50/50 split Splitting shares equally between two or three co-founders makes intuitive sense, but the distribution should be based on the contributions or sacrifice each makes. Lesson 6: Vest your shares Once youve agreed the share split, instead of issuing shares upfront, the smarter way is to earn your shares over time using a vesting schedule . A typical schedule works like this: after one year (the cliff ) youll each earn 25 per cent of your shares, followed by a further 2 per cent each month for the next four years. If someone leaves in the first year, they get zero. Its a great incentive. And this means… Lesson 7: Get it in writing Dont rely on handshake deals. Get things down in writing, whether it’s basic one-pager or a forty-page shareholders agreement (with vesting of course!). Signing up to commitments has a way of flushing out issues that otherwise might be left unsaid. And if you can’t agree on the rules, perhaps it’s time to rethink who you’re about to do business with. Running a startup alone is, for the most part, simply too hard. Finding that special someone or forming a small team at least gives you a fighting chance of success. Its a relationship that will be tested many times and will (on occasion) need repair, but should always be nurtured. David Bushby is the COO at Lexoo.
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