This is the most important document a startup signs in its early days. Every founder must assign to the company all intellectual property they have created that is related to the company’s business, including work created before the company was incorporated.

That prior art clause is the element most founders miss. If you spent three months building a prototype before you incorporated, the prototype is owned by you individually. The company needs an explicit assignment of that prior work, not just future work.

Furthermore, the assignment should include a broad definition of IP: code, designs, algorithms, trade secrets, inventions, domain names, and any other intellectual property created in connection with the business. Narrow definitions leave gaps that become expensive to close later.

A co-founder agreement addresses the things no one wants to discuss when they are excited about a new company: what happens when someone leaves, who owns what equity, how decisions are made when founders disagree, and what the non-compete obligations are on departure.

Vesting schedules are the most important element. A four-year vest with a one-year cliff is the standard in the US startup ecosystem. This means a co-founder earns no equity until one year of contribution, then vests monthly over the subsequent three years. Without a vesting schedule, a co-founder who leaves after six months takes their full equity share, which becomes a significant problem at fundraising when investors see a large undiluted block held by someone who is no longer contributing.

The IP provisions in the co-founder agreement should mirror and reinforce the standalone IP assignment agreement.

Every person who works on your product as an employee must sign an IP assignment agreement before their first day of work. Not on their first day. Before it. An IP assignment signed after an employee has already created work may face enforceability challenges in some states without additional consideration beyond the employment itself.

California requires specific IP carve-out language that protects employees’ rights to inventions developed entirely on their own time without using company resources. Delaware, New York, and other major startup jurisdictions have their own requirements. A generic template may not comply with the law of the state where your employees work.

The confidentiality component ensures employees cannot disclose company information during or after employment, and typically includes non-solicitation provisions preventing them from recruiting colleagues after departure.

Unlike employees, contractors own the work they create by default regardless of whether the engagement is full-time or project-based. The work-made-for-hire doctrine, which automatically transfers IP ownership in the employment context, does not apply to contractors for software under US copyright law.

Software does not fall within the nine categories of works eligible for work-made-for-hire status under 17 USC 101 in an independent contractor context. This means a contractor who writes your core product code owns that code unless there is an explicit written IP assignment transferring ownership to the company.

The assignment must be signed before any work begins. Work created before the assignment is signed is owned by the contractor. An assignment executed after the fact transfers future work only unless it explicitly addresses past work.

Before you show your product, share your pitch deck, or discuss your technology with any investor, partner, or potential customer, get a signed mutual NDA in place. Mutual means both parties are bound, which protects your information and signals that you treat confidentiality as a professional standard.

Many startups skip NDAs for investor conversations, believing investors will not sign them. This is partially true for institutional VCs who review hundreds of deals per year. But angels, strategic partners, potential customers, and advisors should all sign before receiving confidential product information. The agreement takes less than a minute to execute and creates a documented record of the confidentiality obligation.