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The Most Dangerous Lie in Startups
- The absence of a founder agreement can be the most dangerous lie in startups, leading to internal conflicts and eventual downfall.
- Founders often avoid establishing structure when things are going well, but they need it most when complexities arise.
- A founder agreement isn't a sign of mistrust but essential for protecting the business during emotional decision-making.
- Without a clear agreement, issues like equity disputes and decision-making can escalate, causing tension and potential investor backlash.
- Misalignment between founders can be amplified during growth phases and result in personal blame games and deteriorating morale.
- Founder duos should address critical questions early on, such as roles, decision rights, exits, and potential conflicts, to avoid resentment.
- Avoiding difficult discussions can lead to unspoken expectations, misunderstandings, and eventual fallout between co-founders.
- Founder agreements serve as emotional insurance, offering clarity on operations, roles, and contingencies in case of changes or conflicts.
- Establishing a founder agreement is crucial for the company's survival and growth, providing a roadmap for navigating challenges and changes.
- The agreement isn't just for the founders' protection but for ensuring the business's continuity and resilience in the face of inevitable obstacles.
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