Cofounder Equity Split: How to Divide Startup Equity Fairly
The cofounder equity split is one of the earliest and most consequential decisions you will make. Here is how to think about it — and why vesting is non-negotiable.
Few early decisions matter as much as how you split equity with your cofounders — and few are rushed as badly. Get it wrong and you bake resentment, or a broken cap table, into the foundation of the company.
Equal vs unequal splits
A clean 50/50 feels fair and avoids an awkward conversation — which is exactly why founders default to it without thinking. Sometimes it is right. But if contributions, commitment or risk genuinely differ, a forced-equal split can feel *unfair* within a year. The goal is a split both of you will still believe is fair after two hard years.
What to actually weigh
- •The idea and early work — who took the first risk and built the initial version?
- •Commitment — who is full-time, and who is moonlighting?
- •Role and replaceability — how critical is each person to the next 18 months?
- •Capital and risk — who put in money, or left a high-paying job?
Vesting is non-negotiable
A cofounder who walks after six months with 50% of a vesting-free company can make you un-fundable. Investors will check for this; do it before they ask.
Put it in writing — early
Document the split, vesting and roles in a founders' agreement while you still get along. Then see how future rounds affect everyone's stake with the dilution calculator.