In this, our third installment of “Free Startup Tools”, we wanted to highlight an agreement launched by Seedcamp, the European startup accelerator, to help startup founders negotiate the early stages of building a company. (You can check out our first post on The Founder Institute’s effort to standardize the founder-advisor relationship and compensation here and the second post on a tool that helps founders compare their term sheets to the standards here.)
While we’ve touched on these better ways to negotiate term sheets and relationships with advisors, founding a company also often entails bringing on co-founders to help you build your business. Of course, in doing so, it’s important for co-founders to be able to establish a level of trust that allows each founding member to fairly share in the benefits of success.
To do so, Seedcamp (via its Seedhack initiative) is launching the “Seedhack Founder’s Collaboration Agreement”, which according to the initiative’s blog post, has been created to allow newly formed founding teams to “agree on what each founder’s shareholding stake should be” as well as codifying the amount of equity co-founders should receive in accordance with the level of time and effort they pour into the business.
Readers can check out the PDF of the agreement here.
As the accelerator said via its Seedhack blog, the intent with the collaboration agreement is to have it be of use to accelerators and incubators that hose events like Seedcamp’s Seedhack, where “collaboration is key”, as well as to the thousands of startups out there building businesses (and investing sweat equity) in those many ideas, products, and tools before officially creating a “formal” company or enterprise.
Seedcamp says that it wants co-founders to treat the document as fuel for discussion, which can either be used “as-is”, but it should be noted that it is still both a work in progress and a template which founders should modify as they see fit. (Hence the items in brackets, which are left up to founders to input their own language.)
Note: The Seedhack Collaboration Founders Agreement is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.
Please feel free to share your impressions of the agreement, including whether or not readers believe that the vesting schedule proposed in the document applies generally or is more in line with hackathon-type scenarios.
Excerpt image courtesy of Ideachampions.com