The conversation finally turned to numbers. The numbers were the easy part. The structure is what holds.
This page is for the founder negotiating a cofounder buyout while the partnership is still intact enough to write the terms.
A cofounder buyout is three decisions in one: valuation, payment structure, and post-deal role. Settle the structural questions first: equity terms, IP transfer, customer transition, vendor relationships, post-deal role. Price negotiation becomes structural mathematics once the structure is set. Reversing the order produces agreements that come apart at the next consequence.
Each answer is a single direct read. The full read is in the body.
Settle the structure before the price: equity transfer mechanics, IP assignment, customer transition plan, vendor relationship transfer, and the departing cofounder's post-deal role. Price without structure produces unstable agreements.
Three common methods: percentage of current valuation, multiple of historical contribution, or negotiated number. Each produces a different result; the right one depends on which method matches the structural realities of the partnership.
Lump sum, instalment over years, earnout based on future performance, or hybrid. Cash flow capacity decides the structure; the structure decides the price the company can actually pay.
Usually no, and definitely not in any role with continuing decision authority. A clean separation reduces conflict more than a transitional arrangement does.
Legal fees, accounting work, lender notifications, customer reassurance, executive distraction, the team waiting for clarity.
Concessions on structure terms made under emotional pressure that look like paperwork now and become the difference between a clean exit and a year of post-deal litigation.
The price is the visible negotiation. The post-deal authority map is the hidden negotiation. Most cofounder buyouts spend 80 percent of the energy on price and 20 percent on structure, and the structure is where the durable cost lives.
The price, the term sheet, the lawyer drafts. These are the visible objects. The dangerous part is the unwritten question about how the company runs the day the buyout closes, who carries the relationships, and what the departing cofounder is permitted to do next.
Routes into the structural pattern beneath this decision.
When the buyout is contested or the partnership is at the edge.
Cofounder Disagreement PainThe disagreement that often precedes the buyout conversation.
Cofounder Equity DisputeWhen the documents themselves are the binding constraint.
Family Business Decision ConflictsThe Atlas room for role-versus-relationship reads.
Ways To WorkUse this after the structural pattern is clear.
Apply for Tier 03When multiple principals are involved.
If you want Stan to read this live decision, use the application route below.
When the decision is one commitment with real cost, Tier 03 is the commercial route.