When everything is going well, enthusiasm holds everything together. When the first obstacles appear, without written rules, conflict follows. And by then, it is already too late.
At the start of any business venture — whether a technology startup, a reinventing SME or a joint venture between long-standing partners — there is a moment when enthusiasm is at its peak and everything seems possible. It is precisely in that moment that the most costly mistake is made: postponing formal agreements because ‘we trust each other’ or ‘we’ll deal with it later, right now we need to move fast’.
The problem is that agreements are not needed when things are going well. They are needed exactly when things get complicated: when results are delayed, when roles overlap, when an outside investor enters the picture, or when someone wants to leave. And at that point, if the rules were never defined, every conversation becomes a negotiation from scratch — often contentious, almost always expensive.
When the money arrives, the problems arrive
There is an old but accurate saying: clear agreements make long friendships. This holds in any human relationship. In a business partnership it holds twice over, because what is at stake is not just the personal relationship, but the value of the company, the ownership stakes, and the future of everyone involved.
Field experience teaches that corporate crises rarely stem from bad faith. They come from ambiguity. A partner who believed they had an operational role and finds themselves sidelined. A technical consultant who received equity without anyone defining what they needed to do to earn it. A co-founder who reduces their commitment but keeps their percentage intact. These are situations that, with a clear written agreement, never become conflicts.
Equity is not a gift: it is a contract
Bringing in a key person with equity — a technical director, commercial manager, or strategic consultant — is a legitimate and often necessary choice when you cannot compete on cash compensation. But that equity must be earned, not simply granted.
Vesting — the progressive accrual of shares over time or upon reaching specific milestones — exists precisely for this reason. It is not a punitive instrument: it is the rule of the game that protects everyone. The professional knows exactly what they must do to consolidate their stake. The founders know that no one will occupy a share without genuinely contributing. External investors find a credible cap table, not one populated by inactive shareholders.
Alongside vesting, every serious agreement must define what happens when someone leaves: those who exit by mutual agreement after fulfilling their commitments, and those who abandon the project or are removed for non-performance. These are completely different situations, and the treatment of their shares must reflect that. Without this distinction, every departure becomes a dispute.
Structure before you begin, not during the crisis
The right time to build these rules is before — before the professional is already operational, before the investor knocks on the door, before the first tensions arise. Not because one wants to imagine negative scenarios, but because it is far easier to discuss hypothetical rules when the climate is positive than to negotiate rights and exits when something has already gone wrong.
As advisors, our role is exactly this: to sit down with the entrepreneur and structure the process before the journey begins. To clarify who does what, with what level of commitment, towards what measurable objectives, and with what consequences in the event of change. Then, together with our specialist legal partners, that process is translated into the correct formal framework: articles of association, shareholders’ agreement, vesting arrangements, exit clauses. Tools that exist, work, and are available under applicable law.
Conclusion
There is nothing suspicious about asking for clear rules from someone who joins your company. On the contrary: it is a signal that the venture is serious, that the value being built deserves to be protected, and that everyone involved is treated with professional respect. Written rules do not complicate relationships — they make them sustainable over time. The problem is never the legal instrument. The problem is waiting until you need it to go looking for it.
Facing a similar situation? Contact us for a strategic consultation.
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