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Starting a company with someone you trust can feel effortless at first. You’re aligned on the idea, feeling excited about what you’re building together, and running on momentum. Talking about money can feel awkward, overly formal, or unnecessary — especially if you’re friends, former colleagues, or long-time collaborators.
But here’s the truth most cofounders learn the hard way: Startups don’t usually fall apart because the product fails. They fall apart because expectations were never aligned about money, risk, and what happens when things get hard.
A “cofounder prenup” creates early clarity. It’s a set of honest, upfront conversations that help you protect your relationship, the company, and yourselves before capital, equity, or stress complicate everything. The goal is simply to ensure no one is silently carrying assumptions that could later turn into resentment.
So, before that first payment hits your bank account, Mercury, a fintech platform that offers business and personal banking services*, shares what every founding team should talk through together, in the open, to avoid money issues between cofounders.
What’s a cofounder prenup?
If you were getting married to the love of your life, even though you trust that person, you’d probably still talk about finances before making it a done deal, not because you’re planning for disaster, but because pretending money won’t matter is optimistic. You’d likely discuss things like: How do we split expenses? What’s our budget? What happens if one person earns more — or nothing at all — for a while?
A cofounder prenup involves having that same conversation, but with your business partner. It’s not an actual legal document, but rather a set of honest conversations to help you get aligned and document your approach to handling money.
Starting a company together is a legal partnership with real financial consequences. There’s cofounder equity split, risk, debt, outside investors, and long stretches where the business might not pay you at all. And yet, many founders jump in without ever saying out loud what they’re assuming will happen.
Take these cautionary tales from Reddit threads:
These examples are exactly why the cofounder prenup is so im