What to do if a co-founder leaves

Founders leave for many reasons: burnout, family, a new job, a fight. If you have vesting and leaver terms in writing, this is a process. If you don't, it's a negotiation, and often an expensive one.

First: try to understand

Have an honest conversation. Sometimes the issue is solvable: less time, a different role, a break. If they're leaving, try to agree on a respectful exit. A calm, fair split protects the company's reputation.

Checklist

• Shares: apply your vesting and leaver terms. Agree on the buy-back of unvested shares and sign the transfer.
• Register changes: update the business register if they were a director or shareholder.
• IP: confirm in writing that everything they built belongs to the company.
• Accounts: move ownership of domains, code repositories, social media, bank and cloud accounts. Change passwords.
• Money: settle loans, unpaid expenses and any salary owed.
• Confidentiality: remind them of the confidentiality and non-solicitation terms.
• Handover: documents, contacts, open tasks and customer relationships.

Tell people the right way

1. 1
   TeamTell them first, together if possible, with a clear plan for who takes over what.
2. 2
   InvestorsTell them before they hear it elsewhere: what happened, the plan, and whether you'll look for a new co-founder.
3. 3
   CustomersOnly those who worked with the person, and focus on continuity.