For Founders Law

Tech, AI and SaaS

Founder vesting and IP assignment

Founders earn their shares, and the company owns the work. Setting up the company and agreeing who owns what.

What it is

Founder vesting means founders earn their shares over time, so if someone leaves early the company can usually buy back the shares they haven’t earned. The IP assignment moves the code, designs and other work each founder created, including work from before incorporation, into the company.

Work a founder made before the company existed belongs to that founder until it is assigned in writing. Investors check both points, and both are harder to fix once a founder has left.

You likely need this if

  • You and a cofounder are splitting the equity
  • Any founder wrote code or made designs before you incorporated
  • You’re putting a shareholder agreement in place
  • You’re getting ready for investor due diligence

What the starting price includes

  • Founder share vesting terms
  • IP assignment from each founder to the company

What can change the price

  • Number of founders

We tell you before doing anything outside the agreed scope, and agree the fee first.

Read first How does founder vesting work? In a Canadian startup, founders usually own their shares from day one, but agree that the company can buy back the unvested portion if they leave early. A common schedule is four years with a one-year cliff, then monthly vesting. The terms usually sit in the shareholder agreement or a separate share restriction agreement, and they protect the founders who stay. Read the guide

Terms you’ll hear

VestingIP assignmentArticles of incorporationShareholder agreementDue diligenceCliff

Often needed with it

Questions founders ask

Why would founders vest their own shares?

It protects the founders who stay. If a cofounder leaves early, vesting usually lets the company buy back their unvested shares, rather than leaving a large stake with someone who is no longer building the company.

What is a cliff?

An initial period in a vesting schedule before any shares vest. If a founder leaves before the cliff, nothing has vested.

Doesn’t the company already own what the founders build?

Not automatically. Under the Copyright Act the author is generally the first owner, and an assignment is only valid if it is in writing and signed. Work made before incorporation needs a written assignment to move into the company.

General information, not legal advice.

How it works

  1. A free 15-minute call. What you’re building and what you need.
  2. A written scope and fixed fee. Before any work starts.
  3. A short, tailored intake. A few focused questions for your matter, so we start with what we need.
  4. Drafting or review. Most work is back within three business days.
Send us a note All fees