Will founders who do not have board representation receive compliance rights? Finally, it is sometimes difficult to compare the offers of different accelerators. What is important is that we do not charge companies fees to be part of YC. We understand the complex reasons why some accelerators levy royalties on companies that participate in their programs and, while we do not believe this is bad behaviour, founders should naturally deduct these costs from the investment when considering these offers. We also strive to avoid all terms “gotcha” such as improved yields in downside exit scenarios and similar provisions. We have discussed with a number of leading entrepreneurs their personal experience of business creation contracts. Some have worked successfully without formal and written founders contracts. Others have been quick to enter into formal agreements that have resulted in disaster from the outset, while others, over time, have carefully developed agreements that have helped keep their businesses on track. We cannot give you a specific rule for the creation of a founding agreement, and a conflict with the co-founder is inevitable. But we can provide them with a framework that will help you avoid frequent mistakes and help you manage conflicts.
I hope that the agreement of a founder will not leave much room for differences of opinion when most things have been presented in detail, but if they arise, a dispute resolution procedure described in your agreement can put an end to the arguments more quickly. The co-founders of BlackBuck decided not to write a formal agreement from the beginning. However, they took the time to clarify expectations of responsibilities and role allocation. The focus on these decisions has allowed their launch to evolve exponentially. Between July and December 2015, they grew from three sites with three customers to 54 cities with 50 customers and the team grew from 35 employees to 250. In less than two years, they developed a technology platform and set up a network that completely revolutionized India`s truck industry. By the end of 2018, BlackBuck has grown to more than 2,000 sites and has served more than 10,000 customers. This section of the foundation agreement covers two main areas.
First, it defines who holds the final authority in different aspects of the business. Second, it determines the circumstances that matter. Although the safe may not be suitable for all financing situations, conditions must be balanced with the interests of the start-up and investors in mind. As with the original safe, there are always trade-offs between simplicity and completeness, so that while not all Edge cases are addressed, we believe that the safe covers the most relevant and common issues.