Most co-founder disputes are predictable from the start. Equity splits without clear roles, vague decision-making authority, mismatched expectations about commitment levels — these almost always become problems. A clear operating agreement signed at the beginning prevents 80% of typical disputes.
What should be in it
Equity allocation with vesting (standard: 4 years, 1-year cliff). Decision-making authority (who decides what unilaterally; what requires unanimous agreement). Commitment expectations (hours, time off). Departure terms (what happens if someone leaves before vesting completes). Dispute resolution process. Intellectual property ownership.
Why drafting it early matters
Easier to discuss difficult topics before they're problems. Sets expectations explicitly. Provides framework for inevitable difficult conversations. Legally enforceable if dispute reaches courts.
Cost
Solicitor-drafted: £1,000-3,000. Online templates (LegalZoom, Rocket Lawyer): £100-300 for basic. For substantial businesses, invest in solicitor work. The cost is trivial relative to dispute costs later.