Founders’ Agreement in Turkey: Why Every Startup Needs One

A startup may begin with an idea, a small team and a high level of trust between founders. During the early stages, founders often focus almost entirely on product development, fundraising, marketing and customer acquisition.

Legal documentation is frequently postponed.

This is one of the most common mistakes made by startup founders.

When two or more people establish a business together, their relationship should not depend solely on verbal promises, informal messages or personal trust. As the company grows, the value of the business increases, investors enter the company, responsibilities change and disagreements may arise.

A properly drafted Founders’ Agreement can establish clear rules before these problems occur.

For startups operating in Turkey, a Founders’ Agreement can regulate matters such as:

• founder ownership,
• duties and responsibilities,
• decision-making authority,
• founder vesting,
• intellectual property ownership,
• confidentiality,
• non-compete obligations,
• founder departure,
• transfer of shares,
• deadlock situations,
• fundraising,
• investor relations, and
• exit transactions.

This article explains why startups in Turkey should consider entering into a Founders’ Agreement and which provisions should normally be addressed.

What Is a Founders’ Agreement?

A Founders’ Agreement is a contract entered into between the founders of a startup.

Its purpose is to determine the rights, obligations and expectations of the founders in relation to the company and to one another.

The agreement can be signed:

• before incorporation,
• at the time of incorporation, or
• shortly after the company has been established.

In practice, preparing the agreement as early as possible is usually preferable.

The longer founders operate without clear contractual rules, the greater the risk that expectations will develop differently.

One founder may believe that all founders must work full-time.

Another may believe that part-time involvement is sufficient.

One founder may expect to receive a salary.

Another may believe no salaries should be paid until investment is raised.

Unless these issues are discussed and documented, disagreements may emerge later.

Is a Founders’ Agreement Mandatory in Turkey?

A Founders’ Agreement is generally not a mandatory document required merely to incorporate a company in Turkey.

A company may legally be established without one.

However, the fact that a document is not legally mandatory does not mean that it is commercially unnecessary.

The articles of association contain the company’s fundamental corporate rules, but they usually do not regulate every issue that may arise between startup founders.

For example, standard articles of association may not adequately address:

• how many hours each founder must work,
• what happens if a founder stops contributing,
• founder vesting,
• good leaver and bad leaver rules,
• confidentiality obligations,
• IP assignment,
• founder salaries,
• fundraising responsibilities,
• deadlock solutions, or
• detailed exit arrangements.

A Founders’ Agreement can therefore complement the company’s constitutional documents.

Founders’ Agreement vs. Articles of Association

These two documents should not be confused.

The articles of association are the constitutional corporate document of the company.

They regulate matters such as:

• company name,
• registered office,
• business purpose,
• share capital,
• share structure,
• management,
• representation, and
• certain shareholder rights.

A Founders’ Agreement, by contrast, is primarily a contractual arrangement between the founders.

It may contain considerably more detailed provisions regarding the commercial relationship between them.

However, founders must understand an important issue under Turkish law.

A contractual provision contained in a Founders’ Agreement does not necessarily create the same corporate effect as a provision validly included in the articles of association.

Certain rights should therefore be reflected in the corporate documents where legally possible and appropriate.

Good startup structuring requires coordination between:

• the Founders’ Agreement,
• articles of association,
• corporate resolutions,
• share transfer arrangements, and
• future shareholders’ agreements.

Why Is a Founders’ Agreement Important?

Startup disputes often arise not because the founders intended to act unfairly from the beginning, but because expectations were never clearly defined.

Consider a startup founded by three people.

At incorporation:

• Founder A develops the software,
• Founder B handles sales,
• Founder C handles financing and strategy.

Each receives one-third of the company.

Six months later, Founder C receives another job opportunity and stops participating in the startup.

However, Founder C still owns approximately 33% of the company.

Founder A and Founder B continue working for four years and eventually build a business worth millions.

Without an appropriate contractual mechanism, Founder C may retain the same ownership percentage despite having contributed only during the earliest stage.

This is precisely the type of problem that founder vesting provisions are designed to address.

1. Founder Roles and Responsibilities

One of the first sections of a Founders’ Agreement should define what each founder is expected to contribute.

Responsibilities may include:

• software development,
• product management,
• sales,
• marketing,
• fundraising,
• finance,
• operations,
• recruitment,
• regulatory compliance, or
• business development.

The agreement should avoid vague statements such as:

“Each founder will contribute to the company.”

Instead, responsibilities should be described with reasonable clarity.

For example:

Founder A: Chief Executive Officer, responsible for fundraising, strategy and business development.

Founder B: Chief Technology Officer, responsible for software architecture, product development and technical personnel.

Founder C: Chief Operating Officer, responsible for daily operations, finance and administration.

This structure helps prevent later disputes concerning whether a founder fulfilled their commitments.

2. Full-Time or Part-Time Commitment

Startups frequently require significant personal commitment.

The agreement should therefore address whether founders are expected to work:

• full-time,
• part-time,
• a minimum number of hours, or
• according to specified milestones.

This can be critical.

If one founder works sixty hours per week while another contributes only several hours each month but they own equal shares, resentment may develop quickly.

The agreement may also regulate whether founders can:

• operate another business,
• work for another employer,
• provide consultancy services, or
• invest time in competing projects.

3. Founder Equity

The agreement should clearly identify each founder’s ownership.

For example:

• Founder A: 50%
• Founder B: 30%
• Founder C: 20%

However, simply stating percentages is not enough.

The founders should also consider:

• why these percentages were chosen,
• whether ownership is subject to vesting,
• whether future investment will dilute the founders,
• whether an employee option pool will be created, and
• whether any shares have been promised to advisors or employees.

The cap table should reflect reality.

Informal promises concerning equity can create serious problems during future investment rounds.

4. How Should Startup Founders Divide Equity?

There is no legal rule requiring founders to divide the company equally.

A 50/50 split may be appropriate in some circumstances.

In others, it may create serious problems.

Factors founders may consider include:

• who developed the original idea,
• previous intellectual property contributions,
• financial investment,
• technical expertise,
• expected future workload,
• commercial relationships,
• time commitment,
• opportunity cost, and
• risk undertaken.

The most important issue is not whether every founder receives equal shares.

The important issue is whether the arrangement is understood and accepted before the company becomes valuable.

5. Founder Vesting

Founder vesting is one of the most important protections for a startup.

Under a vesting structure, a founder’s long-term ownership may depend on continued participation in the company.

A common international structure is:

• four-year vesting,
• with a one-year cliff,
• followed by monthly or quarterly vesting.

For example, a founder receives the economic equivalent of 24% of the company subject to four-year vesting.

If the founder leaves after six months, they may receive none of the unvested amount.

If the founder leaves after two years, they may retain only the vested portion.

The exact legal mechanism must be structured carefully under Turkish law.

Founders should not simply copy a foreign vesting template and assume that it will automatically operate as intended.

6. Reverse Vesting

In some startup structures, founders receive shares at the beginning, but certain contractual mechanisms allow unvested shares to be transferred back if the founder leaves early.

This is commonly described as reverse vesting.

The practical objective is simple:

A founder should not retain a disproportionately large percentage of the company after leaving before completing the contribution expected from them.

However, the implementation may involve:

• share transfer undertakings,
• call options,
• contractual repurchase rights,
• share transfer restrictions, and
• corporate approvals.

The structure should therefore be designed according to the company’s legal form.

7. Cliff Period

A cliff is a minimum period that a founder must remain with the company before any significant vesting occurs.

A common example is a one-year cliff.

If the founder leaves after ten months, they may lose the unvested founder equity subject to the agreement.

If they remain for twelve months, the first portion may vest.

The purpose is to protect the company from situations where an individual joins as a founder, receives significant equity and leaves almost immediately.

8. Good Leaver and Bad Leaver

Founders’ Agreements often distinguish between a good leaver and a bad leaver.

This distinction determines what happens to the founder’s shares when they leave.

Good Leaver

A good leaver may include a founder who leaves because of:

• serious illness,
• disability,
• death,
• mutual agreement,
• termination without misconduct, or
• another justified reason.

The agreement may allow the good leaver to retain more of their vested interests or receive a fairer transfer price.

Bad Leaver

A bad leaver may include a founder who:

• commits fraud,
• misappropriates company property,
• seriously breaches the Founders’ Agreement,
• violates confidentiality,
• competes unlawfully with the startup,
• abandons the company without justification, or
• commits serious misconduct.

A bad leaver may face less favorable consequences regarding their shares.

These clauses must be drafted carefully to avoid disproportionate or unenforceable consequences.

9. Founder Salaries

Early-stage startups often have limited cash.

Founders may therefore initially work without salary.

However, this arrangement should not remain undefined indefinitely.

The Founders’ Agreement can regulate:

• whether founders receive salaries,
• when salaries begin,
• who approves salary increases,
• whether salaries depend on fundraising,
• whether expenses are reimbursed, and
• whether founders can receive bonuses.

For example:

Founder salaries will commence after the company completes a qualified financing round of at least USD 500,000.

This may prevent later disagreements.

10. Founder Expenses

Founders frequently use personal funds to pay startup expenses.

These may include:

• software subscriptions,
• travel,
• marketing,
• incorporation costs,
• legal fees,
• equipment, and
• hosting expenses.

The agreement should clarify whether these amounts are:

• founder contributions,
• loans to the company,
• reimbursable expenses, or
• included in equity contributions.

Failing to distinguish between these categories may create accounting and ownership disputes.

11. Intellectual Property Assignment

A startup must control the intellectual property necessary for its business.

The Founders’ Agreement should therefore address ownership of:

• software,
• source code,
• algorithms,
• databases,
• inventions,
• trademarks,
• designs,
• domain names,
• business plans,
• technical documents, and
• other creative works.

Intellectual property created by founders before incorporation should also be considered.

For example, if the CTO developed the initial software personally before the company was established, the company should obtain the appropriate legal rights to use and control that software.

12. Why IP Ownership Matters to Investors

During investment due diligence, investors frequently ask:

“Does the company actually own its technology?”

If the answer is unclear, the investment may be delayed.

Typical red flags include:

• source code owned personally by a founder,
• freelancers without written IP transfer agreements,
• trademark applications filed in a founder’s personal name,
• domain names owned personally by employees,
• third-party software used without valid licenses, and
• undocumented intellectual property contributions.

A Founders’ Agreement should therefore establish a clear framework under which company-related intellectual property is legally controlled by the startup.

13. Confidentiality

Founders have access to the most sensitive information within a startup.

Confidential information may include:

• business plans,
• source code,
• customer data,
• pricing,
• investor discussions,
• financial projections,
• algorithms,
• product roadmaps,
• marketing strategies, and
• trade secrets.

The agreement should define confidential information and prohibit unauthorized disclosure or use.

Confidentiality obligations may continue even after a founder leaves the startup.

14. Non-Compete Obligations

Founders may also agree not to establish or support competing businesses under certain circumstances.

A non-compete clause may regulate:

• competing activities,
• duration,
• geography,
• customer solicitation, and
• employee solicitation.

However, competition restrictions should be reasonable and legally enforceable.

An unlimited worldwide prohibition lasting many years may face enforceability problems.

The restriction should protect legitimate business interests without going further than necessary.

15. Non-Solicitation

A founder leaving a startup may attempt to recruit:

• key employees,
• developers,
• customers,
• suppliers, or
• investors.

A non-solicitation provision can restrict such conduct for a defined period where legally appropriate.

This can be particularly important for technology startups whose value depends on a small number of highly skilled employees.

16. Decision-Making Authority

The agreement should explain how important decisions are made.

Day-to-day matters may be handled by the CEO or management.

Major decisions may require founder or shareholder approval.

Reserved matters may include:

• issuing new shares,
• raising investment,
• borrowing substantial amounts,
• changing the business model,
• selling intellectual property,
• entering new countries,
• hiring or dismissing senior executives,
• approving founder salaries,
• selling the company, or
• winding up the business.

Clearly allocating decision-making authority reduces the risk of future conflict.

17. Reserved Matters

Reserved matters are decisions that cannot be taken without a specified level of approval.

For example, the Founders’ Agreement may require approval of founders holding at least 75% of the shares for:

• capital increases,
• major borrowing,
• acquisition of another company,
• sale of substantial assets,
• modification of founder compensation, or
• change in the company’s principal business.

Reserved matters become even more important after investors enter the startup.

Investors commonly request veto or consent rights over certain major corporate actions.

18. 50/50 Founder Deadlock

A particularly dangerous structure is a company owned equally by two founders without a deadlock solution.

Founder A owns 50%.

Founder B owns 50%.

If they disagree, neither may have sufficient votes to proceed.

Possible deadlock mechanisms may include:

• negotiation,
• mediation,
• escalation procedures,
• third-party expert determination,
• buy-sell arrangements,
• Russian roulette clauses,
• Texas shoot-out mechanisms, or
• company sale procedures.

Not every mechanism is suitable for every startup.

The important point is that deadlock should be considered before it occurs.

19. Share Transfer Restrictions

Founders usually do not want another founder to sell their shares freely to an unknown third party.

A Founders’ Agreement may therefore regulate share transfers through mechanisms such as:

• lock-up periods,
• pre-emption rights,
• rights of first refusal,
• consent requirements,
• permitted transfers, and
• prohibited transfers.

These mechanisms can help preserve control over the startup’s shareholder structure.

20. Lock-Up Period

A lock-up prevents founders from selling their shares for a specified period.

For example, founders may agree not to transfer shares for three years except in permitted circumstances.

This assures other founders and investors that the founding team will not immediately cash out after receiving investment.

Exceptions may be created for:

• transfers to family holding companies,
• estate planning,
• investor-approved transactions, or
• company exit events.

21. Right of First Refusal

A right of first refusal may require a founder who receives an offer from an outside buyer to give existing shareholders or the company an opportunity to purchase the shares first.

For example:

Founder A receives an offer to sell 15% of the company to Investor X.

Before accepting, Founder A may be required to offer the same shares to Founder B on equivalent terms.

This mechanism can help existing owners maintain control.

22. Pre-Emption Rights

Pre-emption rights may give existing shareholders an opportunity to participate when new shares are issued.

Without such rights, an investor could potentially receive newly issued shares that significantly dilute existing founders.

For example:

Founder owns 60%.

Investor owns 40%.

The company issues additional shares to a new investor.

The original founder’s percentage may fall significantly.

Pre-emption provisions can help protect shareholders against unexpected dilution, subject to applicable corporate law.

23. Drag-Along Rights

Drag-along rights are designed to facilitate an exit.

Suppose a strategic buyer wants to acquire 100% of a startup for USD 25 million.

Shareholders holding 90% agree to sell.

A founder holding 10% refuses.

A properly structured drag-along mechanism may require the minority shareholder to sell on equivalent terms.

Without such a clause, a small shareholder may potentially prevent or complicate a valuable exit transaction.

24. Tag-Along Rights

Tag-along rights protect minority shareholders.

If a founder holding a controlling interest sells to an outside buyer, minority shareholders may have the right to participate in the sale.

For example:

Founder A owns 70%.

Founder B owns 20%.

Investor owns 10%.

If Founder A sells control to a third party, Founder B and the investor may have the right to sell some or all of their shares on comparable terms.

Tag-along rights are particularly important for minority founders and early-stage investors.

25. What Happens If a Founder Wants to Leave?

The agreement should establish a clear departure process.

Issues may include:

• resignation notice,
• transfer of responsibilities,
• company property,
• confidentiality,
• intellectual property,
• access credentials,
• vested equity,
• unvested equity,
• company repurchase rights, and
• post-departure restrictions.

A founder leaving without a structured process may create serious operational problems.

26. Death or Incapacity of a Founder

Founders rarely consider what happens if one of them dies or becomes permanently unable to work.

However, this can have major consequences.

Without planning, shares may pass to heirs who:

• do not understand the startup,
• do not want to participate,
• have conflicting interests, or
• prevent future investment.

The Founders’ Agreement may therefore regulate mechanisms concerning:

• inheritance,
• company purchase rights,
• shareholder purchase rights,
• valuation, and
• insurance arrangements.

Any such structure should also be coordinated with mandatory inheritance and corporate law rules.

27. How Are Founder Shares Valued?

If one founder must transfer shares, the parties need a method for determining price.

Possible approaches include:

• fair market value,
• latest investment valuation,
• independent expert valuation,
• book value,
• predetermined formula, or
• discounted price in bad leaver situations.

An unclear valuation mechanism can turn a founder departure into prolonged litigation.

The agreement should therefore specify both:

• the valuation method, and
• the person or procedure responsible for determining it.

28. Funding Obligations

The agreement should clarify whether founders are required to invest additional money.

For example:

If the startup runs out of cash, are all founders required to contribute?

If one founder invests additional money and another cannot, does ownership change?

Is the additional financing treated as:

• capital,
• shareholder loan, or
• convertible financing?

These issues should be considered before financial pressure arises.

29. Fundraising Responsibilities

Startup fundraising can require months of work.

The Founders’ Agreement may allocate responsibilities relating to:

• investor outreach,
• pitch preparation,
• due diligence,
• financial modeling,
• investment negotiations, and
• closing.

The founders may also agree on which investment decisions require unanimous or qualified approval.

30. Future Investors

The agreement should anticipate the possibility that investors will eventually enter the company.

An investor may require:

• amendments to founder rights,
• founder vesting,
• board representation,
• liquidation preference,
• anti-dilution protection,
• information rights,
• reserved matters, and
• employee option pools.

Founders should understand that their original agreement may need to be replaced or supplemented by a shareholders’ agreement during a financing round.

31. Founder Dilution

Future investments normally dilute founders.

For example:

Before Investment

Founder A: 50%
Founder B: 50%

After Investment

Founder A: 40%
Founder B: 40%
Investor: 20%

The founders should understand that dilution is a normal part of venture financing.

The agreement may establish principles regarding:

• approving fundraising,
• pre-emption rights,
• option pools, and
• minimum acceptable valuation.

32. Employee Stock Option Pools

Investors often require startups to create an employee equity pool.

For example, an investor may request a 10% employee option pool before investment.

This may dilute the founders.

The Founders’ Agreement should therefore contemplate whether employees and advisors may receive equity and who has authority to approve it.

33. Advisors and Equity Promises

Startups often promise small equity percentages to advisors.

Statements such as:

“We will give you 1% of the company.”

should not remain informal.

The arrangement should clarify:

• whether it is actual equity,
• an option,
• subject to vesting,
• calculated before or after investment,
• conditional on continued advisory services, and
• subject to dilution.

Undocumented equity promises can become major due diligence problems.

34. Founder Loans

A founder may finance the startup personally.

The agreement should distinguish between:

• equity investment,
• shareholder loans, and
• ordinary expenses.

If Founder A contributes TRY 2 million while Founder B contributes nothing, the legal and economic consequences should be documented.

Otherwise, disputes may arise concerning repayment or ownership.

35. Company Bank Accounts and Financial Control

The agreement may also regulate financial authority.

Questions include:

• Who controls the company bank account?
• Can one founder transfer funds alone?
• Is joint approval required above a certain amount?
• Who approves expenses?
• Who prepares budgets?
• Who has access to accounting records?

These controls are particularly important where founders have equal ownership.

36. Books and Information Rights

Every founder should understand what financial and operational information they are entitled to receive.

The agreement may provide regular access to:

• management accounts,
• financial statements,
• bank reports,
• customer metrics,
• sales reports,
• budgets, and
• investor updates.

Transparency reduces suspicion and potential disputes.

37. Related-Party Transactions

A founder should not normally be able to cause the startup to enter transactions benefiting themselves without appropriate approval.

Examples include:

• leasing property owned by the founder,
• buying services from another founder-owned company,
• granting loans to founders,
• transferring company assets, or
• paying unusual consulting fees.

The agreement may require independent or qualified approval for related-party transactions.

38. Startup Opportunities

A Founders’ Agreement may regulate whether founders must present certain business opportunities to the company.

For example, if the startup operates in cybersecurity and a founder personally receives an opportunity directly related to the startup’s core business, can that founder pursue the opportunity independently?

Clear contractual rules may prevent conflicts of interest.

39. Founder Removal

A difficult question is whether a founder can be removed from management.

Share ownership and management authority are separate matters.

A founder may continue owning shares while losing:

• executive position,
• board membership,
• manager status, or
• representation authority.

The agreement should distinguish between:

• removing a founder as an employee or executive, and
• forcing a transfer of that founder’s shares.

The second issue usually requires significantly more careful legal structuring.

40. Dispute Resolution

The Founders’ Agreement should contain a clear dispute resolution clause.

Possible mechanisms include:

• Turkish courts,
• mediation,
• arbitration, or
• multi-stage dispute resolution.

For international founder teams, arbitration may sometimes be considered because of:

• confidentiality,
• neutrality,
• procedural flexibility, and
• cross-border enforcement considerations.

However, arbitration can also be expensive.

The appropriate mechanism depends on the startup’s size, ownership and international structure.

41. Governing Law

Where founders are from different countries, they may consider which country’s law will govern their agreement.

If the company is incorporated in Turkey, Turkish mandatory corporate law will remain highly relevant even if contractual provisions refer to another governing law.

Founders should therefore avoid assuming that selecting English, Delaware or another foreign law automatically determines every corporate issue relating to a Turkish company.

The agreement must be coordinated with the corporate law governing the company itself.

42. Confidential Arbitration

Founder disputes can severely damage a startup’s reputation.

Investors, customers and employees may become concerned if internal conflicts become public.

For this reason, some startups choose confidential arbitration mechanisms for certain disputes.

Whether arbitration is appropriate depends on factors such as:

• expected dispute value,
• international ownership,
• costs,
• urgency, and
• enforceability.

43. What Happens When Investors Enter?

A Founders’ Agreement is generally designed for the relationship between founders.

When an institutional investor enters, a more comprehensive Shareholders’ Agreement is often negotiated.

The new agreement may regulate:

• investor rights,
• board composition,
• liquidation preference,
• anti-dilution,
• founder vesting,
• information rights,
• reserved matters,
• future funding,
• share transfers, and
• exit rights.

The Founders’ Agreement should therefore be drafted with future investment in mind.

44. Can a Founders’ Agreement Prevent Every Dispute?

No contract can eliminate every disagreement.

Its value is different.

A good agreement answers important questions before the founders’ interests diverge.

It creates a predetermined mechanism for situations such as:

• founder departure,
• fundraising,
• dilution,
• equity transfer,
• management disagreements,
• intellectual property disputes, and
• exit transactions.

This can significantly reduce uncertainty.

45. Common Mistakes in Founders’ Agreements

Using a US Template Without Turkish Legal Review

Startup templates from the United States or United Kingdom may contain concepts that do not automatically produce the intended result under Turkish corporate law.

Ignoring the Articles of Association

The Founders’ Agreement and corporate documents should be coordinated.

No Vesting

Giving founders unconditional ownership on day one can create severe problems if one leaves early.

No IP Assignment

The startup may not legally control its own technology.

Vague Roles

Statements such as “everyone will contribute equally” are difficult to enforce.

No Deadlock Mechanism

This is particularly dangerous for 50/50 companies.

No Founder Departure Rules

The parties only consider what happens when someone joins, not what happens when someone leaves.

Unclear Equity Promises

Informal commitments to employees and advisors may later create claims.

Excessive Non-Compete Restrictions

Overly broad restrictions may face legal enforceability issues.

Ignoring Future Investment

The agreement should not create provisions that make future fundraising unnecessarily difficult.

46. Founders’ Agreement Checklist

A comprehensive Founders’ Agreement for a Turkish startup may consider:

• founder identities,
• company structure,
• share ownership,
• capital contributions,
• roles and responsibilities,
• time commitments,
• founder salaries,
• expenses,
• founder loans,
• vesting,
• cliff periods,
• good leaver rules,
• bad leaver rules,
• IP ownership,
• confidentiality,
• non-compete obligations,
• non-solicitation,
• management,
• voting,
• reserved matters,
• share transfers,
• lock-up,
• pre-emption,
• rights of first refusal,
• drag-along rights,
• tag-along rights,
• deadlock,
• fundraising,
• future investors,
• employee equity,
• founder departure,
• death or incapacity,
• valuation procedures,
• dispute resolution,
• governing law, and
• amendment procedures.

Not every startup needs every provision.

The agreement should reflect the actual needs of the founders.

47. When Should a Founders’ Agreement Be Signed?

Ideally, founders should discuss and document their relationship before the startup becomes valuable.

A useful time is:

• before incorporation, or
• immediately after incorporation.

Negotiating these issues early is easier because the founders’ interests are generally aligned.

Once:

• investment has been raised,
• revenue has increased,
• shares have become valuable, or
• a disagreement has already begun,

negotiations become significantly more difficult.

48. Should a Startup Lawyer Prepare the Founders’ Agreement?

For a serious startup, legal advice is strongly recommended.

The agreement is not merely a standard commercial contract.

It may involve issues under:

• Turkish Commercial Code,
• Turkish Code of Obligations,
• intellectual property law,
• employment law,
• competition rules,
• tax considerations, and
• investment law.

A lawyer should also consider whether certain provisions need to be implemented through additional corporate documentation.

The objective should not merely be to produce a long agreement.

The objective should be to create a structure that actually works when a difficult event occurs.

49. Practical Example

Consider a SaaS startup established by three founders.

Founder A owns 45%.

Founder B owns 35%.

Founder C owns 20%.

Founder A works as CEO.

Founder B develops the software.

Founder C is responsible for sales.

The Founders’ Agreement provides:

• four-year vesting,
• a one-year cliff,
• full-time commitment,
• company ownership of all IP,
• confidentiality obligations,
• restricted share transfers,
• pre-emption rights,
• drag-along and tag-along rights,
• board approval for major expenditures,
• a mechanism for founder departure, and
• arbitration for specified disputes.

After eighteen months, Founder C leaves.

Because the agreement already regulates this situation, the parties know:

• which shares Founder C retains,
• what happens to unvested equity,
• what information must remain confidential,
• how company accounts must be returned, and
• whether any share transfer procedure applies.

Without the agreement, every one of these issues could become a separate dispute.

50. Why Investors Want Founders to Have Clear Agreements

Investors invest not only in a product but also in the founding team.

A serious founder dispute can destroy company value.

Investors therefore want certainty concerning:

• who owns the company,
• who owns the technology,
• which founders must remain,
• what happens if someone leaves,
• whether equity is vested,
• whether there are unknown share claims, and
• whether management can function effectively.

A clear legal structure reduces investment risk.

During due diligence, unresolved founder issues may cause an investor to:

• delay the investment,
• require restructuring,
• demand additional founder vesting,
• reduce valuation,
• impose additional conditions, or
• abandon the investment.

Conclusion

A Founders’ Agreement is one of the most important legal documents for a startup in Turkey.

It allows founders to establish clear expectations regarding ownership, responsibilities, management and long-term participation before disagreements arise.

The agreement can address fundamental issues including:

• founder equity,
• vesting,
• founder departure,
• intellectual property,
• confidentiality,
• decision-making,
• share transfers,
• deadlock,
• fundraising, and
• exit rights.

Startups frequently fail to prepare these rules because the founders trust each other.

Trust is important.

But a professional legal structure does not replace trust; it protects the relationship when circumstances change.

Founders should therefore ask difficult questions while the relationship is strong:

What happens if one founder leaves?

What happens if one founder stops working?

Who owns the software?

Who controls the company?

Can a founder sell shares?

What happens if the founders disagree?

What happens when an investor enters?

What happens when someone offers to buy the company?

A well-drafted Founders’ Agreement answers these questions before they become disputes.

For a startup planning to raise investment, scale internationally or build long-term company value, establishing clear founder rules at the beginning may be one of the most valuable legal decisions the founders make.

Legal Disclaimer: This article is provided for general informational purposes only and does not constitute legal, tax or investment advice. The appropriate terms of a Founders’ Agreement depend on the company’s legal form, ownership structure, sector, founders and financing strategy. Startup founders should obtain professional legal advice tailored to their specific circumstances before entering into binding agreements.