Starting a business is exciting. You will have big dreams, a small team and most importantly, immense energy to turn your idea into something real. However, one of the biggest problems that a new start-up can face is when a team member leaves early. It can be a co-founder, an early employee, or even the partner you trusted the most. When someone important leaves at the beginning stage, the entire business can be shaken up. This is why it is important to make sure that your start-up is protected from early departures. 

Why are early departures a problem?

When your start-up is just beginning, every person on the team matters. It is like building a small boat. If one person jumps out, it can easily tip over. You can lose important skills, knowledge, and motivation. It can also damage your reputation. Investors can think that your business is not stable. Customers will wonder what is going on behind the scenes, and the rest of your team will feel confused and discouraged. Early departures can create legal and financial problems as well. For example, what will happen to the person’s shares in the company? What if they start a new company with your idea? What if they also take your clients with them? These are serious issues that many founders do not think about until it is too late. 

Here is how you can protect your start-ups from early departures.

Set clear expectations from the beginning

The ideal way to avoid misunderstandings later is to ensure having clear conversations right from the start. Everyone joining the start-up needs to understand what is expected from them. This will include their role, responsibilities, working hours, and commitment levels. When people know what they are signing up for, they are not going to leave early or suddenly. It is also important to talk about what is going to happen when someone wants to leave. While this may feel uncomfortable, it is also necessary. Having this conversation early will show that you are a professional and are serious about the business. It helps people think twice before making random decisions.

Use a founders’ agreement

A founders’ agreement is a simple document that will outline how the company is going to run and what each founder is going to be responsible for. It should include things like how decisions will be made, how much equity every person is going to get, and what will happen if someone leaves the company. This document doesn’t need to be filled with legal terms. It should be clean and fair. Even if you and your co-founders are best friends or family members, a written agreement is extremely important. It helps in avoiding arguments in the future. It also ensures that everyone is being treated equally and respectfully.

Include a vesting schedule

A smart way to protect your start-up is by using a vesting schedule for shares. This means that a person doesn’t get all their shares right away but will earn them with time. For example, if someone has been promised 20% of the company, they are going to earn 5% each year over four years. If they leave after one year, they are going to get only 5% and not the complete 20%. This will protect the company because only people who stay and work hard should own a big piece of it. A vesting schedule also shows investors that you have been planning wisely. In fact, it is one of the most common practices that successful start-ups follow.

Build a strong company culture

People are going to stay when they are happy and feel valued and are included in the big decisions of the company. That is why building a good company culture is as important as your business plan. Your team needs to feel like a family, where everyone supports each other and enjoys working together. Good communication is a huge part of this. Make sure that you are talking openly about your problems, ideas, and progress. Whatever win you get, ensure that you are celebrating them together. Do not forget to encourage honesty and teamwork. When people feel that they belong, they are less likely to leave. A strong culture will keep the team motivated even when times are tough.

Choose the right people

In the beginning, it might be tempting to hire friends or people who say that they are interested. However, in a start-up, you will need people who are committed and share your vision. You have to take time to choose your co-founders, partners, and early employees. Look for people who believe in your business and are also ready to face whatever challenges are thrown at them. You can ask questions like:

• Why do you want to join the start-up?
• Are you ready to work hard for a few years without expecting big rewards?
• What are your long-term goals?

These questions can help in understanding the true intentions of people you are looking to hire. Hiring the right people from the start will save a lot of trouble later.

Learn from each departure

Understand that, even when you are doing everything right, there is a high chance that people can leave. If someone does leave, do not move on without thinking about why they left. Take time to understand why it happened. Did they feel stressed, or were they unclear about their role? Were their expectations too high? Ensure that you are using these insights to improve your start-up. There is a chance that you need to communicate clearly, have better onboarding plans or have more team bonding activities. Every departure is your chance to learn and make your business stronger for the future. 

Conclusion

Early departure can be scary, however, they do not need to destroy your start-up. With clear planning, honest communication and the right set of people, you will be able to protect your business from any unnecessary setbacks. Think of your start-up as building a house; if the foundation is strong, it will be able to handle a few cracks. Ensure that you are being smart from the start, and your start-up is going to have a better chance of growing into something great.