As a solo founder, shouldn’t I still execute a reverse-vesting for future investment possibilities?

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JASON LEMKIN

Probably, but the real advantage of reverse vesting is to protect you against a less committed co-founder. More on that here: A Simple Commitment Test For You And Your Co-Founders

It is a good idea to have “standard” vesting in place before you meet with “standard” VCs. If you don’t, they’ll ask you to re-vest some of your shares. But it destresses the issue if you’ve electively already done it yourself. It shows you’re ready for prime time.

But while important for fundraising, the real point of proper founder vesting is to protect the most committed founders from the flakes. Since founders own so much of the company … the last thing you want is an uncommitted co-founder walking away with an unfair amount of equity. Nothing is more tragic that one founder toiling away for 7–10 years, while another leaves in the first 6 months with almost the same % ownership of the company. This also can make you structurally difficult to fund as well. No one wants to fund a messed-up cap table.

You can fix your own vesting. You can’t fix the vesting of someone that quits. Not really.

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Published on January 2, 2017
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