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Co-founder's agreements vs. Partnerships,LLPs and Companies

How do co-founders agreements compare to forming a partnership, LLP or a company? The reason entering into a co-founders agreement is advisable (in preference to formally starting a company or a limited liability partnership or entering into a partnership agreement) is because it keeps business conduct very simple and reduces compliance requirements and formalities to a minimum. Of course, if a third-party investor is looking to invest in a business, he or she will insist that it be incorporated as a company (unless the investment is from a family member, relative or a friend, in which case they may not be insistent on this). Until then, using the co-founders agreement as a reference for governing one’s professional relationship with co-founders is a prudent idea.

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