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Understanding more about equity ownership

On Behalf of | Feb 24, 2015 | Business Formation & Planning |

Entrepreneurs in Colorado may benefit from understanding more about how equity issues between cofounders may be resolved. There are a number of factors to consider when evaluating whether or not the division of business assets is equitable to all parties involved in creating the enterprise. In most cases, executives may be entitled to more equity than key personnel who have not achieved executive status within the organization yet.

Each founders’ current position in the organization may dictate how much they are entitled to retain if a dispute were to ever arise. Partners may also need to consider how much each party contributed to building and maintaining the enterprise before any equity is divested. Parties who have contributed more investment capital may have more interest when divvying the equity of the enterprise. The party who originally facilitated the conception of the business may also be entitled to receive a greater stake in equity interest.