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Founders Agreements Shareholders Agreements Subscription Agreement Constitutional Documents Shareholder Loans Shareholder Exits New Shareholders Founders Disputes Founders Departures Roles in Business Biz Terms Owner Relations Line Employee Share Option Scheme ( ESOP )

What is the role of the Founder in a Start Up?

The Founder is the spark. They see something others don’t - a market gap, a burning need, a game-changing idea. That vision becomes the heartbeat of the business. Without it, there’s no reason for anyone to show up, invest, or care.

Founders bring energy and belief when there’s nothing but risk and uncertainty. They're not just dreamers - they act. They convince early hires to join, investors to back them, and customers to trust them, all before there's anything proven. It’s gritty, it's raw, and it’s powerful.

Being a Founder isn’t about having all the answers. It’s about having the courage to ask the right questions, attract the right people, and make decisions that set the tone for the future. Founders don't just create companies - they create possibilities.

Why the Founder is important

The Founders are instrumental to the Start Up in so many key ways including:

◼️Concept Champion: they are the lightning rod of belief in the new business idea.

◼️Leadership: they play early stage leadership to the Business.

◼️Credibility: how they act and what they do reflects on the credibility of the Business idea.

◼️Culture Builder: they define the values and behaviours that shape the organisation from Day 1.

◼️Investor Magnet: early investors bet on people - and that means betting on Founders.

◼️Talent Attractor: top early hires are drawn to strong, inspiring Founders.

Key Definitions

◼️Founder: the principal who initiates the idea and without which – there is no business.

◼️Co-Founder: joins the Founder in bringing the Start Up business to life.

◼️Founding Team: the small group of individuals who support and help operationalise the Founder’s vision in the early days.

◼️Founder Equity: the ownership stake allocated to Founders in exchange for their early and ongoing contribution to the venture.

◼️Founder Vesting: a contractual structure that ensures Founders earn their equity over time, typically tied to continued involvement.

◼️Founder Agreement: a legal document that defines each Founder’s rights, responsibilities, and equity - designed to prevent disputes and misalignment.

How does a strong Founder Build Value in a Start Up?

Strong founder relationships allow the Start Up to build far more quickly. The benefits include:

◼️Professionalism: having founder relationships dialled in reflects a professional operation.

◼️Cohesion Equity: strong founder relationships can build equity value in the Business.

◼️Enhanced Growth Rate: having each founder play in position delivers faster growth.

◼️Standard Setting: how the founders interact sets standards for everyone in the Start Up.

◼️Risk Resilience: mutual trust among founders helps navigate tough decisions and setbacks.

◼️Investor Confidence: aligned, respectful founder dynamics instill greater confidence in external stakeholders.

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