standard Vesting Didn’t Kick In? — any advice?

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Started by sue_me_maybe_19 · Mar 11, 2025 · 6 replies
For informational purposes only. This is not legal advice.
CV
sue_me_maybe_19OP

Looking for advice on this situation. Cofounder Left After 6 Months - Standard Vesting Didnt Kick In? Any guidance would be greatly appreciated.

Details: I'm in a situation where I need to understand my legal options. Has anyone dealt with something similar?

CM
billable_hours_2

Securities compliance isn't optional. Even for a friends-and-family round, you need a proper exemption (usually Reg D 506(b)). The penalties for unregistered securities offerings are severe and personal.

EL
pls_no_judge_4Attorney

Securities compliance isn't optional. Even for a friends-and-family round, you need a proper exemption (usually Reg D 506(b)). The penalties for unregistered securities offerings are severe and personal.

SA
desperate_times_etc_12

At the seed stage, simplicity wins. SAFEs are simpler than convertible notes (no maturity date, no interest). But some investors prefer the forced conversion mechanic of a note. Know your leverage.

CV
sue_me_maybe_19OP

Update: Thanks everyone for the guidance. I consulted with an attorney and we're moving forward. The advice here helped me understand what questions to ask and what to expect. Will update when there's a resolution.

HR
HRproSarah_13

Co-founder vesting disputes are some of the messiest cases I handle. A few principles that come up repeatedly:

  1. If there's no written vesting agreement — this is the worst scenario. Without a written agreement, equity ownership usually follows what's on the cap table/operating agreement. If your co-founder is listed as owning 50%, they own 50%, even if they stopped contributing after month 3.
  2. Standard vesting — 4-year vesting with 1-year cliff is standard for a reason. Implement it from day one, even (especially) between co-founders.
  3. "Acceleration" triggers — some agreements include single-trigger (all shares vest on change of control) or double-trigger (change of control + termination). Make sure you know which you have.

If you're in the middle of a dispute, the remedy depends entirely on your corporate documents. Get a lawyer to review your articles, operating agreement, any stock purchase agreements, and board resolutions.

LM
losing_my_mind_here_2

Went through this exact nightmare. Co-founder owned 50% with no vesting, contributed for 6 months, then ghosted while I built the product for 2 more years. When we finally got acquisition interest, he showed up wanting his full 50%.

Ended up settling for him getting 15% (from 50%) after expensive mediation. The mediator's logic: he contributed meaningfully during formation but abandoned the venture, so a reasonable equity split reflected actual contribution. But we had no written vesting — the only reason he accepted 15% was because he didn't want to spend $50K+ on litigation with an uncertain outcome.

Lesson: GET VESTING IN WRITING ON DAY ONE. It's an uncomfortable conversation that saves you from a devastating one later.