How do we handle deadlock when two co-founders own 50/50 and cannot agree on a major decision?
A pure 50/50 split with no tiebreaker is a design flaw, not fairness. Build a deadlock mechanism into the shareholders agreement before you ever hit one: a casting vote on defined matters, a neutral third director, a mediation step, or a buy-sell (shotgun) clause as the last resort. Equal ownership is fine, equal paralysis is not. Decide who breaks ties while you still like each other.
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This is the explainer written for exactly your situation: two founders, 50/50, no tiebreaker. It lays out the full menu you can put in your shareholders agreement before you need it, from a neutral third party who casts the tie-breaking vote, to a mediation step, to the buy-sell endgame, and names each shotgun variant (Russian Roulette, Texas Shoot Out, adjusted fair market value at a 125% buy or 75% sell) so you can pick one deliberately instead of discovering you have none.
This is the worked mechanics of the buy-sell clause in Indian shareholders-agreement language, not a generic Western template. It walks Russian Roulette (you name a price, the other side chooses to buy you out or sell to you at that same price, so you never lowball) and Texas Shoot-out (sealed bids, highest bidder buys), and makes the point most founders miss: keep your list of Reserved Matters short, because an over-broad list turns trivial disagreements into deadlock triggers.
The cleanest case for the answer's core move: appoint a chairman who holds a casting vote so an even split can still produce a decision. It separates prevention (casting vote, independent director, supermajority thresholds, put/call options drafted up front) from cure (mediation, forced buyout, winding up), which is the right way to think, you want the prevention list in your agreement so you never touch the cure list.
