Founder Vesting and Good and Bad Leaver Clauses: What Investors Ask For and What’s Fair
Founder vesting means a founder earns their shares over a period of time instead of owning all of them outright from day one. If they leave before the shares have vested, the company can take back the unvested ones, usually by buying them at nominal value or converting them into worthless deferred shares. Good leaver and bad leaver clauses decide what happens to the shares that have vested, based on why the founder left.
Investors ask for both when they put money in, because they’re backing the team as much as the idea. A founder who walks out a year after the round with a third of the…
The skinny
The skinny isn't ready yet — notes appear once the transcript is processed.