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# Founders’ Equity Split Calculator

With this tool, the startup’s accompanying coaches will be able to show their accompanied how to intelligently calculate the distribution of the share capital of the emerging enterprise between the co-founders.

A model designed to calculate intelligently the distribution of the capital stock of your start-up between the co-founders

The FESC (Founders ‘ Equity Split Calculator®) consists of a matrix of quantification of the contributions of each of the associates (the matrix probe 3 macro-variables defined by 30 statements) and a model of calculation of the distribution of the shares returning to each of the founders according to his/her own tangible and intangible contributions.

The purpose of the FESC is to help first-time entrepreneurs avoid falling into the trap, often fatal in the long run, of the great easiness, for instance, when they arbitrarily distribute stock capital in equal shares for each of the founders (50-50 %, 33-33-33%, 25-25-25-25%, etc.). The tool is a simple way to organize as objectively as possible the relevant information in order to collectively make reasoned decisions, deliberate and balanced in terms of sharing the stock capital of the start-up.

It is presented in the form of an Excel table where everything is flexible to make it as practical as possible: the weight of each of the macro-variables (human capital, sweat capital, tangible capital) is variable (we can modify their coefficients), the same applies to the weight (in a number of points) of each of the statements (startup experience, business experience, expertise acquired, degree of openness, etc.).

The team can collegially decide how to quantify each element of the table (matrix). This includes a blank part where the co-founders will be able to train at will and a numerical example that can serve as a point of comparison.

This facilitation and learning tool makes it possible to:

1.  Understand the best allocation of stock capital among co-founders by relativizing and evaluating what each puts on the table.
2.  Discover the strengths of the founding team.
3.  Transform unpleasant sharing negotiations into a fun collegial experience. The sharing recommendation can be used as a starting point for potential new share allocation negotiations.

The quality and precision of the startup’s stock capital sharing calculation between the partners depend on the quality and accuracy of the responses provided by the users of the model. The FESC is based on the results of academic and entrepreneurial research as well as empirical data. It is suitable for most emerging businesses.

However, as each start-up is unique and each of the founders is a unique combination of talents and roles in a start-up, some talents and roles may not be included in the model.

Therefore, it is suggested to users to use the results of the stock capital-sharing calculation only as a vital lead (Ariadne’s clew), a starting point for deeper negotiations with their co-founders, and not as a decision engraved in the stone.

The idea behind this calculator is to establish a weighting (on a scale of 0 to 10) for each of the key criteria collegially chosen by the founders, then to assign a value to the contribution of each of the co-founders (also on a scale from 0 to 10).

Then, we take the weighting and multiply it by the score of the candidate to obtain the weighted score. From there we get the overall score and ranking of each candidate.

• Step 1: The founders’ answer (each in their column) to concise and objective questions.
• Step 2: Based on their responses the proprietary algorithm estimates their relative contributions to the project
• Step 3: Based on these estimates, the system suggests the most equitable distribution of shares among the founders.

For instance, the Human Capital macro-variable is detailed by 9 statements which are defined by 37 possible answers. Each answer is assigned a number of points.

The FESC matrix  (available in English or in French version) includes 4 tables of calculation whose parameters are modifiable:

– Detailed table (figured example)
– Summary table (figured example)
– Blank detailed table (set for unlimited training)
– Blank summary table (set for unlimited training)

Prix du FESC : 25 euros  (TTC)

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