DeccanBridge Hyderabad — Startup & Venture Law

Founder agreements in Hyderabad.

Every startup dispute we have ever litigated traces back to something the founders never wrote down. One document, signed early, prevents almost all of it.

The document that protects the company from its own founders

Hyderabad's startup ecosystem produces hundreds of new founding teams a year — and a predictable share of founder breakups. The casualties are rarely caused by bad faith; they are caused by ambiguity. Who owns what percentage, and does it vest? What happens to the equity of a founder who leaves in month eight? Who owns the code written before incorporation? Who decides when the founders disagree? A founders' agreement answers these questions while everyone is still friends — which is the only time they can be answered cheaply.

We draft founder agreements informed by both sides of our practice: the venture deals we close (so your documents anticipate what Series A investors will demand) and the founder disputes we litigate (so your documents close the gaps those fights exploit). Vesting with cliffs, reverse-vesting on shares, watertight IP assignment, leaver provisions, deadlock resolution and lawful restrictive covenants — built for Indian law, including the Section 27 limits on non-competes most templates ignore.

What we handle

Equity & vesting design: Equity splits with 4-year vesting and 1-year cliffs, structured through enforceable Indian-law mechanics — transfer and buyback arrangements, not just promises.
IP assignment: Present and future IP — including pre-incorporation work — assigned to the company with moral-rights waivers; the asset investors actually diligence.
Roles & decision rights: Titles, responsibilities, time commitments and decision thresholds documented so authority is clear before it is contested.
Leaver provisions: Good-leaver and bad-leaver treatment of unvested and vested equity — the single most dispute-preventing clause in the document.
Restrictive covenants: Confidentiality, non-solicitation and non-compete provisions drafted within Section 27 Contract Act enforceability limits.
Deadlock & exit: Tie-breaker mechanisms, mediation tiers, buyout valuation formulas and shotgun clauses for irreconcilable splits.

How we work

A partner-led process.

Founder alignment session

A structured conversation that surfaces the hard questions — contributions, expectations, exits — before drafting.

Term agreement

Equity, vesting, roles and leaver terms agreed on a one-page term sheet everyone genuinely understands.

Drafting & execution

Full agreement drafted, explained clause by clause to every founder, and properly executed.

Funding-round alignment

At investment, the founders' agreement transitions cleanly into the SHA — no contradictions for diligence to find.

Practice lead

Mohammed Aman — Startup & Venture Law

Advises founders on incorporation, funding rounds, ESOPs and investor terms, working closely with Hyderabad's startup ecosystem.

Common questions

Founder Agreements FAQ.

When should founders sign a founders' agreement?

At or before incorporation — ideally before significant work, capital or IP goes in. Every month of delay increases both the difficulty of the conversation and the stakes of leaving it undocumented. Signing one later is still far better than never.

Is founder vesting enforceable in India?

Yes, when structured correctly. Indian law does not have a native 'restricted stock' concept, so vesting is implemented through contractual transfer obligations, buyback arrangements and Articles provisions that make unvested shares recoverable when a founder exits. Template US-style vesting language without these mechanics often is not enforceable — which founders discover at the worst possible time.

What happens if a co-founder leaves with a large equity stake?

Without an agreement: they keep it all, dead equity on your cap table that repels future investors. With proper leaver provisions: unvested shares return to the company or remaining founders at nominal or fair value depending on leaver category. This single scenario justifies the document.

Are founder non-competes enforceable in India?

During the engagement, yes. Post-exit non-competes face Section 27 of the Contract Act, which voids agreements in restraint of trade — but well-drafted confidentiality, non-solicitation and IP protections achieve most of the commercial objective lawfully. We draft for what courts actually enforce.

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