How should my co-founder and I split equity, and is 50/50 a mistake?
Split on the future, not on who showed up first. Equal-ish splits are fine when both partners are full-time and equally committed, but a hard 50/50 with no tie-breaker is dangerous because it deadlocks every hard decision. Give one person a symbolic tie-breaker (51/49 or a designated CEO whose vote wins) and vest everything over 4 years. Never split based on 'my idea,' since ideas are worth almost nothing before execution.
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YC's counterpoint is worth hearing precisely because it pushes back on being stingy: if this person is a real co-founder doing years of work ahead of you, generosity buys motivation across a four-year vest and prevents resentment. Read it against your traction story to decide honestly whether this is a true co-founder (lean generous) or an early employee wearing the title (grant, not founder equity). It is also the canonical source on why a one-year cliff and four-year vesting are non-negotiable.
The first-hand cautionary tale our answer needs. Kwan went 50/50 across two startups over nine years, put in 100k of her own savings, took loans, skipped her salary, and ran BD, sales, and ops while her technical cofounder drew a steady paycheck and coded. When the company sold, the equal split paid him more for less risk, and the resentment ended the friendship. Her fix is exactly our tie-breaker instinct: a 10-minute conversation naming who actually owns what, then splitting on that.
The India edge on paper. It states plainly that "equal splits are often unfair," then does what the US pieces skip: it turns our tie-breaker advice into an actual clause set for an Indian Pvt Ltd or LLP, voting protocols, deadlock provisions, and mediation/arbitration for when two founders lock horns, plus the 4-year, 1-year-cliff vesting. A handshake 50/50 is not a founders agreement; this shows you what the document that prevents the deadlock actually contains under Indian contract law.
