Guide
The Founder Playbook
A plain-language series on getting the legal basics right, one topic at a time.
A plain-language series on getting the legal basics right, one topic at a time.
Most legal problems founders run into weren’t caused by a single bad decision. They were caused by a basic protection that was never put in place, because it didn’t feel urgent at the time — until it suddenly was. This guide walks through the legal fundamentals every founder should have in place, in the order they typically matter, with links to tools you can use to check where you actually stand on each one.
Incorporation isn’t just a formality — it’s the foundation everything else sits on. A properly incorporated company, with clean statutory filings from day one, is far easier to raise money into, hire into, and eventually exit, than one that’s been operating informally and needs to be cleaned up later. If you’re not sure where your company stands, our Incorporation Checklist is a good starting point.
The single most common gap we see isn’t the absence of an agreement — it’s an agreement that only covers the equity split and nothing else. A real founders’ agreement addresses what happens if someone leaves early, how disputes get resolved, and who has authority over what. These are uncomfortable conversations to have when everyone is optimistic and getting along, which is exactly why they need to happen then, not later. Our Founder Agreement Checker walks through what a complete agreement actually covers.
Code, brand, content, and product ideas created before incorporation, or created by a contractor without a written assignment clause, do not automatically belong to the company. This is one of the most common findings in due diligence, and one of the easiest to fix early and the most disruptive to fix late.
Verbal agreements and email threads are not contracts. Your major customer, vendor, and contractor relationships should be governed by written agreements, even if they feel informal. This isn’t about distrust — it’s about having something clear to point to when expectations diverge, which they eventually will on some matter, even in the best relationships.
ROC filings, tax deadlines, and labour law compliance don’t announce themselves. Missing them quietly compounds into the kind of finding that stalls a fundraise or an acquisition at exactly the wrong moment. A simple compliance calendar, reviewed monthly, is a small habit that prevents a large problem.
An informal promise of "some equity later" is not an ESOP. If you plan to grant options to employees, a board-approved scheme with a clear policy on vesting, exercise, and leaver treatment protects both the company and the people you’re trying to reward. Our ESOP Readiness Assessment covers the structural elements that most schemes miss.
Whether it’s a fundraise, an acquisition conversation, or an unexpected dispute, the founders who move fastest are the ones whose basics were already in order before they needed to be. Our Investment Readiness Score and Due Diligence Readiness Tool are both built to help you find out where you stand before someone else finds out for you.
Future installments will go deeper into each of these areas — including a closer look at term sheet red flags, structuring founder vesting fairly, and what actually happens during a legal due diligence review. If there’s a specific topic you’d like covered, let us know.