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When to create a shareholders’ agreement

When is the best time to draft a shareholders’ agreement (SHA)?

I’m starting a business with a friend where I would be primarily responsible with fundraising and other business development activities, while he would be reponsible for the product design. It’s been longer than 6 months now since he’s started working on it and I have yet to see anything he’s created, but have lined up a number of investors. I wouldn’t be opposed to the SHA but he’s named himself the CEO with a lot of decision making power, relegating me to almost a mere bus dev manager. I believe an SHA is premature until I’ve actually seen the mock-ups, especially a document that gives him a lot of decision making power. Unfortunately, he insists on having me sign this before I see the mock-ups or we’ve actually started building anything. I’ve suggested that we at least revisit our Vision and Values, and he doesn’t see any value in those either.

My question is when is the best time to have the SHA drafted?

  • “he’s named himself the CEO….I’ve suggested that we at least revisit our Vision and Values, and he doesn’t see any value in those either.”

    Obviously You’re the one being the CEO

    The CEO is SALES

    Product supports sales

    You need both

    Only a fool tries to be both

    Healthy friction between product & sales fires up the soul of the business

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