FirstPlayable · Tools

Founder Setup Checklist

16 checks across four sections. Nothing is stored — your answers live in the URL.

The company almost always starts after the work does, and the gap is where the expensive problems live.

Someone built the prototype before there was an entity. A friend did the first art. A contractor was paid without an assignment clause. None of it matters until an investor's lawyer asks, and by then the person you need a signature from may not reply to email.

The three that matter most

If you do three things this month: get a signed IP assignment from every founder covering work before incorporation, map everyone who contributed before the company existed, and put reverse vesting on the founders including yourself. The first two are cheap now and sometimes impossible later. The third is a negotiation you will otherwise lose during a raise.

01 · The company

The entity, the split, and what happens when someone leaves. Agreed while everyone still agrees.

The company exists before the work does
A registered entity, with a registration number, dated before the first line of code or art.
Usually missing: The order. Almost every studio starts as people making something and incorporates later, which means the earliest and most foundational work was created by individuals rather than by a company. That is fixable and it is much cheaper to fix in month two than in year two.
Done when
- The entity is registered and you have the number.
- You can name the date, and you know what work predates it.
- Anything that predates it appears on the pre-incorporation list in section 02.
What happens when a founder leaves
Written terms for both a good leaver and a bad leaver, agreed by everyone.
Usually missing: Departure entirely. Founders' agreements cover splits, roles, and titles — the things that feel important at the start — and omit the clause that actually gets used. A co-founder holding thirty percent of a company they left two years ago makes the next round unraisable.
Done when
- Good leaver and bad leaver are both defined.
- There is a mechanism and a valuation basis for buying shares back.
- The founder who would be most disadvantaged has read and signed it.
The split is decided and written, not assumed
Percentages agreed by everyone, in a signed document, before there is anything worth arguing about.
Usually missing: The conversation. Splits get assumed — equal because it feels fair, or weighted by who had the idea — and the assumption holds right up until someone's contribution changes. Having it early is uncomfortable; having it late has ended studios.
Done when
- Every founder can state the same percentages without checking.
- It is signed, not agreed verbally.
- It accounts for anyone who is expected to join as a founder later.
Founder shares vest, and the schedule is real
Reverse vesting on every founder's shares, with a cliff, from a stated start date.
Usually missing: Reverse vesting on the founders themselves. Teams put vesting on employees and leave founders fully vested from day one — so a founder who leaves in month four keeps their entire stake, and the ones who stay build the company around a dead holding.
Done when
- Every founder's shares are subject to vesting, including the majority holder.
- There is a cliff, and a start date that is written down.
- The schedule in the agreement matches what the cap table shows.

02 · The IP

Whether the company actually owns what it was built on. Where small studio raises most often die.

Contractor agreements actually assign the IP
A signed agreement per contractor with an explicit assignment clause, not just payment terms.
Usually missing: The clause. Paying an invoice does not transfer copyright in most jurisdictions. Small studios pay contractors properly and promptly and still do not own the work, because nobody read past the rate.
Done when
- Every contractor who touched the project has a signed agreement.
- You have read the IP clause in each one, rather than assuming it is there.
- Anyone paid without one has been asked for a confirmatory assignment.
Every tool is licensed for what you are actually doing
Engine, middleware, plugins, and assets, each on a tier that permits commercial release.
Usually missing: The tier check. Free and personal tiers get used during prototyping and nobody revisits them, so a tool bought for learning ends up in a commercial build. It is usually in editor tooling rather than in the game, which is why it survives to launch unnoticed.
Done when
- The list was built from the project files, not from memory.
- Every entry has its tier recorded and confirmed commercial-safe.
- Anything bought on a personal account is either transferred or replaced.
Every founder has assigned their work to the company
A signed assignment from each founder, covering everything they have made for the project.
Usually missing: Any document at all. Founders assume that owning the company means the company owns their work, and it does not. Without an assignment the company holds a claim it cannot prove, which is a problem the first time anyone performs diligence.
Done when
- Every founder has signed an assignment.
- It covers work made before incorporation as well as after.
- The documents are stored where they can be found in five minutes.
Pre-incorporation work is mapped and assigned
A list of everyone who contributed before the company existed, with an assignment or a written gap.
Usually missing: The list. Someone built the prototype, a friend did the first art, a contractor was paid without an assignment clause. This is the most common fatal defect in a small studio raise and it is entirely preventable, which is what makes finding it late so painful.
Done when
- The list was built from git history, credits, and payment records — not from memory.
- Everyone reachable has signed a confirmatory assignment.
- Anyone unreachable is documented, with the scope of what they touched.

03 · Money

Separate accounts, closed books, read grant conditions, and every promise written down.

The books are closed on a schedule
A monthly close on a fixed day, by a named person or an accountant.
Usually missing: The cadence. Bookkeeping happens when a deadline forces it, so the burn figure is only accurate immediately after a filing and drifts for the rest of the year — including during the months a raise is being planned.
Done when
- The last three months are closed.
- It happens on a fixed day with a named owner.
- The burn figure in your budget matches the books.
Grant conditions have been read, not summarized
The actual clauses, quoted, for anything public money is attached to.
Usually missing: The reading. Public funding commonly carries clawback triggers, reporting obligations, and territory restrictions, and founders learn the conditions from the application form rather than the agreement. An investor's lawyer will read the agreement.
Done when
- Clawback triggers are quoted, not paraphrased.
- Any reporting or territory obligation is on someone's calendar.
- You know what a change of control does to each grant.
Company money is separate from personal money
A company bank account, used for everything the company pays for.
Usually missing: The discipline rather than the account. The account gets opened and founders keep paying for subscriptions personally because it is faster, so the burn figure is wrong and the reimbursements pile up into an awkward conversation with an accountant a year later.
Done when
- A company account exists and is the default for company spending.
- Nothing recurring is on a personal card.
- Any founder loan or reimbursement is recorded rather than remembered.
Every equity promise is written down, documented or not
A list of everything anyone has been told they would get, including the vague ones.
Usually missing: The vague ones. A contractor promised "a few points," a friend who helped early, an advisor who was told there would be something. They surface in diligence, and an investor who finds one undocumented promise assumes there are others.
Done when
- Every founder has been asked separately what they promised.
- The list includes promises the team believes are not binding.
- Each entry is either converted or extinguished in writing.

04 · Working agreements

Who decides what, who is committing what, and what happens to the work if you stop.

Advisors have terms, or they are not advisors
A written agreement per advisor: what they do, for how long, for what.
Usually missing: The document. Advisors accumulate informally — a friendly senior person, a former colleague — and each one has a vague expectation of equity that nobody wrote down. It ends up on the undocumented promises list, and every entry there costs something.
Done when
- Every advisor has a written agreement or is not called an advisor.
- Each has a term and a vesting schedule.
- Anyone who drifted away has been formally removed.
Who decides what, written down
Named decision areas per founder, agreed while everyone still agrees.
Usually missing: The boundaries. Early founders decide everything together, which works at two people and fails at six — usually first on a decision where two founders each believed it was theirs, and by then it is about authority rather than the decision.
Done when
- Each founder has named areas where they decide alone.
- There is a written tiebreaker for genuine deadlock.
- It has survived at least one real disagreement.
What each founder is actually committing
Days per week per founder, with a date any part-time founder goes full time.
Usually missing: The asymmetry. One founder is full time and one has a job, everyone knows, nobody has written it down, and the equity assumes equal contribution. The resentment builds quietly and surfaces about eighteen months in.
Done when
- Each founder's committed days per week are written down.
- Anyone part time has a date and a trigger for going full time.
- Where commitment differs, the equity treatment is stated.
What happens to the work if you stop
An agreed position on who holds the IP and who may continue, if the company winds down.
Usually missing: Any position. Nobody wants to discuss failure at the start, so a studio that winds down leaves an unowned prototype nobody may legally use — including the people who made it, which is the outcome everyone would have wanted to avoid.
Done when
- There is a written position on IP if the company closes.
- It says whether any founder may continue the project, and on what terms.
- Every founder has read it.

Three rules about setting up

Do the IP first, while everyone is still friendly. A confirmatory assignment is a five minute favor from someone who likes you and an impossibility from someone who does not.

Ask founders separately. On the split, on promises made, on who decides what. The answers differ more often than anyone expects, and the difference is the finding.

Write down the uncomfortable ones. Leaver terms, unequal commitment, what happens if you stop. Every one of these is easier now than it will ever be again.

How to score it

Count the boxes. There are 16.

Score	Read	What to do
0–5	Set up in name only.	Start with section 02. IP assignment is cheap while relationships are good and occasionally impossible once they are not.
6–10	The basics exist, the edges do not.	Work through section 01. Vesting and leaver terms are the two that get deferred and the two that end studios.
11–14	Better set up than most teams at your stage.	Section 04 is what is left. The working agreements feel unnecessary until the first real disagreement, which is exactly when it is too late to write them.
15–16	Properly done.	Run the Data Room Kit next. This checks that the company is set up; that one checks whether it would survive someone looking closely.

01 · The company

02 · The IP

03 · Money

04 · Working agreements

How to score it

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