YC equity split for co-founders — why 50/50 is the default (and when it isn't).

Why YC pushes 50/50

Paul Graham's essay on the subject is blunt: if you can't agree on an equal split at the start, you probably shouldn't be co-founders. The rationale is behavioral, not financial. A skewed split tells the smaller-share founder that they're already worth less on day one. That resentment compounds under stress — and startups are permanent stress.

Michael Seibel puts it this way in office hours: "The extra 5% you fight for at incorporation costs you 100% of the company if your co-founder walks in year two."

The 4-year vest with 1-year cliff

Every YC company signs the same vesting structure before YC's money lands: shares vest over 4 years, with a 1-year cliff. If a co-founder leaves in month 11, they walk away with zero. If they leave in month 13, they keep 25%. The remaining 75% vests monthly over the next 36 months.

This is not optional. YC's SAFE side-letter requires it. See the YC SAFE explainer for the full document mechanics.

When to deviate from 50/50

• Late-join co-founder. If one founder has been building for 12+ months before the other joins, 10–30% for the newcomer with a full 4-year cliff is standard.
• Very unequal capital. If one founder is putting in $500K of their own money and the other zero, adjust — but consider a loan or preferred stock instead of a permanent equity skew.
• Three or more founders. Equal-thirds or equal-quarters is still the YC default, but a slight founder-CEO bonus (2–5%) is common and rarely causes disputes.

What to do this week

1. Have the equity conversation before you incorporate — not after.
2. Use Clerky or Stripe Atlas to file with 4-year vests and 1-year cliffs baked in.
3. Write a one-page founder agreement covering vesting acceleration on acquisition, IP assignment, and what happens if a founder leaves.
4. Assume you'll disagree in year two. Set the rules while you still like each other.