I’m a fully vested founder, what challenges will I face raising our seed round?

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JASON LEMKIN

None.  If you are upfront about it, and then when asked, acknowledge you are OK adding (back) vesting.

To simplify David S. Rose‘s answer — just tell the new investors.

If they are true angels, e.g., small checks at a Demo Day, they may not care.

All VCs will care.  They’ll usually ask you to re-vest all or some.  As long as you are upfront you are currently 100% vested, but know it needs to change, it won’t be an issue.

Sometimes, if it’s a small round, a small VC may “punt” and let the Bigger VC in the next round deal with the issue.  That may be OK but again only if you are transparent up-front.

Also, bear in mind — this is a good chance to fix a situation.  The more committed founder strongly benefits when a less committed founder leaves with less vesting.  If you are all-in, and control the company, and ain’t going anywhere … you may well benefit a lot from re-vesting all the founders.

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Published on March 21, 2016
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