Startup formation, founder & partner arrangements
Set up the company. Decide how ownership will work.
Early decisions about the entity, founders, working partners, and team agreements affect how the business can operate and grow. Get practical legal guidance before informal promises become difficult to change.
Choose an entity that fits the business you are building.
A founder may be starting alone while planning to add co-founders or investors later. Another owner may be bringing a working partner into an existing company or creating a separate entity for one business line. The right approach depends on the people involved, operations, assets, contracts, management expectations, and plans for growth.
Chris helps business owners compare LLC and corporate structures, including Delaware corporations where appropriate, understand the practical tradeoffs, and put formation and governance documents in place. The engagement must have an appropriate California connection; a matter requiring a legal opinion on another state’s law may require local counsel. The work is tailored to the company’s circumstances rather than a one-size-fits-all startup package.
For a standard LLC formation, see the LLC formation and entity-structuring service. More complex ownership arrangements require a separate scope and fee, which will be explained before work begins.
Planning may include
- LLC or corporation selection and initial ownership structure
- Founder roles, ownership percentages, and decision rights
- Admitting a working partner or creating an entity for a business line
- Time-based or milestone-based equity vesting terms
- Operating agreements, bylaws, corporate approvals, and ownership records
- Founder stock purchase agreements with vesting, where appropriate
- 83(b) election timing and coordination points for tax advice
- Confidentiality, invention assignment, and intellectual-property assignment agreements
- Coordination points for tax, employment, and securities specialists
Founder and partner ownership
Equity terms need to say what happens over time.
When an owner or service provider earns equity over time, the documents should explain the amount, vesting schedule, any milestones, the rights that come with the interest, and what happens if the person stops working with the business. Management authority, voting, distributions, transfers, and approval requirements should fit the same arrangement.
For an LLC, these terms often need to work with the Operating Agreement and the company’s ownership records. A corporation may require founder stock purchase agreements, board or shareholder approvals, and updated capitalization records. Where founder stock is subject to vesting, the parties should address the company’s repurchase rights and applicable tax deadlines, including whether an 83(b) election is available. Tax consequences should be reviewed with the company’s tax adviser.
Founders may also need to plan for an option pool or future financing. Stock option plans, SAFEs, and other securities financing documents raise separate securities and tax issues. Chris Jackson Law does not prepare securities-offering or financing documents; the firm can help identify when securities counsel should be involved and coordinate formation work within the agreed scope.
For standalone LLC agreement work, see Customized Operating Agreements.
Put the startup team’s work and agreements in order.
Early-stage companies often need written agreements with software engineers, consultants, or other team members covering compensation, confidentiality, invention assignment, and ownership of code and other work product. The documents should fit the working relationship and identify any prior-employer, university, or third-party intellectual-property issues that need separate review. Patent prosecution and specialized intellectual-property matters may require IP counsel.
Employee-versus-independent-contractor classification depends on the actual working relationship and applicable state law. California-specific business agreements may be addressed within an agreed scope; specialized employment analysis or another state’s law may require employment counsel licensed in that jurisdiction.
A practical next step
Tell Chris what you need.
Chris personally reviews each inquiry and will explain the appropriate next step if the matter appears to fit the practice.
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