Co-Founder Equity Split & Vesting Framework Calculator
How should equity be split between co-founders based on idea generation, capital injected, time dedication, and execution ability?
Financial Inputs
Recommended Equity Split
Based on multi-factor contribution weighting, the recommended equity split is 53.7% for Founder A and 46.3% for Founder B.
Founder A Holding
53.7%
Founder B Holding
46.3%
Key Financial Takeaways
- Based on multi-factor contribution weighting, the recommended equity split is 53.7% for Founder A and 46.3% for Founder B.
- Founder A total weighted performance index is 8.65/10, driven by time dedication and intellectual execution.
- Mandatory institutional recommendation: Implement standard 4-year reverse vesting with a 1-year cliff to protect both co-founders against early departure.
Frequently Asked Questions
Why should co-founders avoid a default 50:50 equity split?
A 50:50 split frequently leads to fatal corporate deadlock if vision diverges later. Furthermore, equal splits rarely reflect unequal contributions over time (e.g. one founder leaves while the other works 80 hours a week). Implementing a 4-year vesting schedule with a 1-year cliff is essential.
Calculators on this platform provide indicative mathematical estimations based on industry-standard financial appraisal models (including Tandon Committee Method II, Nayak Turnover Method, and standard compound amortisation).
They do not constitute a formal facility sanction, credit commitment, or legal advisory from SME PAISA or any partner banking/NBFC institution. Final terms, interest margins, security stipulations, and credit sanctions remain strictly subject to formal credit appraisal, audited balance sheet verification, CMA Data assessment, and risk committee approval by institutional lenders.
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