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Founder Incorporation Guide

2021-02-04: by Patritsiya Kostadinova

Incorporating your business is an important requirement to graduate from the Founder Institute and a necessary milestone to found a real company. For US companies, we strongly encourage Founders to incorporate a Delaware C-corporation since it is preferred by investors. Founders in other countries will need to form a local equivalent to a Delaware C-corporation. The Founder Institute will not accept US LLCs or S-corporations to meet this requirement. This guide’s purpose is to walk Founders through a step-by-step process to reach this milestone by the incorporation deadline. If you are unable to complete incorporation and sign the required documents provided by the Founder Institute by the deadline, you will be asked to leave the program and re-enroll in a future cohort.

Below you will see critical incorporation milestones in the program:

Mentor Idea Review Session:

After the Mentor Idea Review, you must begin identifying several law firm options to incorporate your company. To ensure you incorporate before the incorporation deadline, you must begin interviewing law firms this week and select a law firm to assist you with incorporation by next week.

Legal Session:

You must select a law firm to work with and upload the engagement letter this week.
Make sure that you fill out your law firm information, and upload your engagement letter in your Documentation tab on FI.co (https://fi.co/company_incorporate).

Go-to-Market Session:

You must make sure your law firm has filed the correct paperwork with the government. You must also sign and upload the entire Founder Agreement to your profile.

Product Development Session:

As soon as your company is officially incorporated with the government, you must upload the incorporation certificate along with the formation agreements, such as bylaws or articles of incorporation. You must also appropriately fill out, sign and upload the Founder Agreement, the Warrant and the Board Consent to your profile. All agreements can be found here: http://fi.co/agreements.

Additional Resources:

Required Documents – Glossary for Documentation Tab in your FI profile

Law Firm– Add your lawyer’s company name, name, email address and phone number.
Engagement letter– This is a letter or contract that defines your relationship with your law firm.
Company Formation Agreements– These documents are the bylaws or articles of incorporation, which set the rules of operation for your company. This should be received together with the incorporation certificate. Examples of a clause in this agreement is company address, number of shares the company is authorized to issue, etc.
Government Incorporation Certificate– An official document received by the government, public agency, etc. for the purpose of confirming the company incorporation.
Equity Collective Agreement– A document that regulates the Founder Institute’s relationship with the Founder.
Warrant– A document signed by the Founder’s company which authorizes the Founder Institute to purchase 4% of the company’s equity at a future date. It could also be a called an option agreement or similar in other jurisdictions.
Board Consent– A form agreement for the board of directors of the Founder’s company to approve the issuance of the Warrant or Option.

Uploading Documents – Step by Step

The following examples shown below are the US versions of the Founder Agreement, Warrant, and Board Consent Form. The examples are meant to be guides to help you fill out the documents correctly. Please make sure that you fill out the appropriate version of the documents for your company and country of incorporation, and follow the specific instructions on the actual documents. The documents can be found on the Agreements page (https://fi.co/agreements). The document versions for your country may differ slightly from the examples below.

Open your account and Go To the Documentation Tab. You should be seeing options to upload all required documents (please see a short description of each of them above). All documents to be uploaded should be in PDF format.

NOTE: Founders can merge multiple signature pages or documents with a free online PDF editor (please check resources above). You are not permitted to alter the text or substance of the documents themselves.

Equity Collective Agreement

Each Founder should read the whole Equity Collective Agreement document and fill out all requested information on page 6. If you chose to not digitally sign the agreement via the Founder Institute portal, you can also scan the document and upoload it. If you chose to scan the document, please note that all pages should be uploaded, not just the ones where you type in information. Please follow the instructions below.

Warrant V3

Founders need to fill out the all of the information in the grey box on page 1, including company name and issuance date of the Warrant. Then on page 10, Founders need to fill out all blank fields. In the case of co-founders, they should only sign one and the same PDF. When you scan the document, please note that all pages should be uploaded, not just the ones where you type in information. Please follow our instructions below.

You do not need to fill out page 11 and 12 (Exhibit A and Exhibit B). The Founder Institute will fill this out at the time of exercise of the Warrant.

Board Consent Form

Founders need to fill out their company name on page 1. Then on page 3, Founders sign and update the date to the current date. In the case of co-founders, they should only sign one and the same PDF. When you scan the document, please note that all pages should be uploaded, not just the ones where you type in information. Please follow our instructions below.

Questions

We expect that questions will come up during the incorporation process, so we advise Founders to read the resources provided above at least one week before the Legal session. This session is an opportunity for Founders to raise their questions with the legal partner, if available. We also recommend that Founders send any additional questions via email to their Local Leaders or our legal team ([email protected]).

The Founder Institute is the world’s largest pre-seed startup accelerator. Since 2009, we have helped over 5,000 entrepreneurs get the focus and support needed to build a business that matters. Based in Silicon Valley and with chapters across 90 countries, the Founder Institute’s mission is to empower communities of talented and motivated people to build impactful technology companies worldwide.

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