FREQUENTLY ASKED QUESTIONS (FAQ's)
In our FAQ section, we attempt to address your curiosities & concerns. If you do not find an answer to your specific question below, please submit an inquiry at the bottom of the page!
Question #1 - What is a Founders' Agreement?
Short Answer: A Founders' Agreement covers the basics of your company and how it will operate.
Long Answer: A Founders' Agreement is a living document that is agreed upon and signed by all of the original founders of a business. It formalizes the business itself, in writing, and covers several important issues, including:
Individual Roles & Responsibilities | Equity & Rewards | Operating Procedures
Ownership | Company Goals, Values & Vision | Intellectual Property
Here is a Link to a great introductuory article on Founders' Agreements!
Question #2 - Why have a Founders' Agreement?
Short Answer: A Founders' Agreement brings clarity to your organization and enables your team to focus its collective efforts on realizing a common vision for the company.
Long Answer: The process of creating a Founders' Agreement provides co-founders with a unique opportunity to realign themselves on critical areas of the business (see above). By discussing individual intentions & expectations against the backdrop of the business, as a whole, co-founders gain a clearer understanding of their duties & responsibilities and those of their fellow co-founders. In addition, a Founders' Agreement acts as an insurance policy against future misunderstandings that could potentially harm your business. We strongly recommend that every startup business creates a Founder's Agreement as early as possible!
Question #3 - Are Founders' Agreements Legally Binding?
Short Answer: It depends on your needs.
Long Answer: Depending on the language used, a Founders' Agreement can either be written as a legally enforceable contract or, at a minimum, used as material evidence in the event of future legal action taken. Even if drafted as a non-legally binding document, a Founders' Agreement functions as an insurance policy against the unexpected. For instance, a Founder's Agreement can serve to defend decisions made or actions taken on behalf of the company.
Question # 1 - Are mediations confidential?
Short Answer: Yes, mediations are always confidential.
Long Answer: At the beginning of every mediation, both parties sign a confidentiality agreement, whereby they agree that everything that is shared during a mediation is strictly confidential. In other words, the subject-matter that is discussed or shared during a mediation cannot leave the room and would be held strictly "inadmissible," or not allowed, within a court of law. Since the mediation process is confidential, parties are encouraged to be open and transparent when communicating and sharing information with the mediator and other party.
Question # 2 - What if I no longer want to participate in the mediation process?
Short Answer: Mediations are purely voluntary, so you can choose to withdraw from the mediation process at your discretion.
Question # 3 - What is a mediator's role in a mediation?
Short Answer: A mediator acts as a 3rd party neutral with only one clear objective throughout the process, to achieve settlement between the parties.
Long Answer: While all mediators are 3rd party neutrals, there are different styles of mediation that can be implemented at a mediators' discretion.
For instance, a mediator can be "facilitative," where he/she primarily assists the parties in reaching a mutually agreeable resolution on their own and does not offer advice, opinions or make decision recommendations.
On the other hand, a mediator can be "evaluative," where he/she makes value judgments on the case, points out weaknesses in the parties' arguments, and provides recommendations based their own evaluation of the relative merits of each side of the dispute. Generally, evaluative mediators have substantial legal or subject-matter expertise in the relevant field in which the dispute falls under.
Question # 4 - Why should I choose mediation over traditional legal methods of dispute resolution? (i.e. hire a lawyer & go to court)
Short Answer: Typically, the mediation process is both faster and more cost-effective than the traditional legal action route. In addition, settlements reached in mediation are consensual (i.e. both parties must agree to settle), while judgments reached in lawsuits or arbitration tend to be both heavily one-sided and highly unpredictable.
Question # 5 - How long does it generally take to resolve conflicts?
Short Answer: While there are no guarantees that a settlement will be reached, the mediation process typically takes anywhere between 4-8 hours. In general, the more complex the issues are within the dispute, the longer the mediation process itself.
Question # 6 - What if the other party (i.e. a co-founder) does not want to participate in the mediation process?
Short Answer: While mediation is purely voluntary, we can reach out to the other party on your behalf and inform them of the benefits of resorting to mediation to resolve internal conflicts.
Still have unanswered questions? Submit your inquiry below!