The Feels Fair Agreement (FFA)
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What is the FFA?
The Feels Fair Agreement (FFA) is a legal document for company founders to have a plan for when things don't go to plan.
It covers the purpose of the company, ownership and equity among the founders, rights and obligations of the founders, and provisions for dissolution and winding up of the company.
Why does the FFA exist?
When I started my first company with a dear friend, we didn't have a conversation about our roles and expectations in the company. Eventually, the realization set in that we didn't have a complementary skillset; we had a duplicative one. A rift formed between us that didn't resolve until years later. It caused a lot of anguish, and dulled what was otherwise a very close relationship.
I created this document using my own experience, and the input from dozens of other first-time founders, built on the simple question: if you could do it all over again, what would you want to make clear with your co-founders?
No one likes to think about the worst case scenario, but it is inevitable that something disastrous will happen during the lifetime of your company.
It's important to have a plan for when (not if) it does.
- Clarity on the purpose and goals of the company, ensuring that everyone is on the same page and working towards a common vision.
- Fair and equal ownership and equity among the founders, so that everyone has a stake in the success of the company.
- A clear understanding of the rights and obligations of the founders, including their roles and responsibilities within the company.
- Provisions for the dissolution and winding up of the company, should the need arise, to ensure a smooth and orderly transition.
- Company Purpose
- SECTION 1: Ownership and Equity
- The Co-Founders
- Additional Shares
- Equity Transfer and Assignment
- Rights and Obligations of Co-Founders
- Right to Participate
- SECTION 2: Decision Making and Management
- The Board of Directors
- Roles and Responsibilities
- Hiring and Firing
- Company Finances and Assets
- SECTION 3: Disputes and Resolution
- Co-Founder Differences of Opinion
- Process for Resolving Disputes
- Disagreements Over Major Company Decisions
- Irreconcilable Disputes
- SECTION 4: Exit and Dissolution
- Co-Founder Exit
- Death or Disability of a Co-Founder
- Remaining Co-Founder Responsibilities
- Company Dissolution
- Miscellaneous Provisions