How do I remove my name from a partnership?

If you want to remove your name from a partnership, there are three options you may pursue:

1. Dissolve your business. If there is no language in your operating agreement stating otherwise, this will be your only name-removal option.
2. Change your business’s name.
3. Use a doing business as (DBA) name.

How do you remove someone from a partnership?

Removing a partner from a general partnership is the act of removing someone from your business that operates as a partnership. It can happen in several different ways, but the most common option is through a clause in the partnership agreement itself.

Should you pay co-founders for startup capital?

Instead, assign equity compensation based on the relative value and volume of the work provided by each founder. A co-founder whose most significant contribution is startup capital should probably be an investor, not a team member. If a co-founder does want to contribute, just pay them back when you close your first funding round.

What happens when a co-founder drops out of a startup?

The earliest days of a startup are often the most critical, and they’re typically the first major test of the founding team’s ability to work together. Every additional co-founder that drops out during this especially turbulent period makes the cap sheet more bloated and complex.

Do founders become less productive after they get paid?

No founder is as productive after getting their full compensation as they are before; they simply have no financial incentive to be. That means they won’t go to bat for their employees and investors nearly as hard when it’s time for an exit.

What makes a good compensation program for startups?

A good compensation program can focus all minds and efforts involved in a startup towards that goal, helping to ensure the path to success is as free of friction and misalignment as it possibly could be.