The first time I have to give a thought to ownership was in front of a term sheet. All the details had been iron out, all the percentages were in there, but I was reflecting on this for the first time.

It's easy to avoid confrontations by thinking that, in the end, we are arguing about percentages of 0. 10% of a company worth 0 is the same amount of money than 50% of that company.

However, something has been shown over and over again is that ownership is the first recognition a scipreneur needs to stay engaged in the process. Once you no longer have ownership you are much less emotionally connected with what you are building, it's much easier to just move to the next position.

Ownership does not necessarily mean control. Each of 3 co-founders splitting a company in thirds will have no control, but they will all have the same level of ownership and responsibility.

That is one of the reasons I think it's fundamental that shares are split based on future contributions to the company and not on past achievements.

In generic contexts, this is obvious: a couple of people get together to start a company and they decide to focus on it. For science-based companies this is, however, not the case. The research program that leads to the innovation has probably run for many years. Perhaps there's more than one PI involved. Plus the universities, the PhD's, Postdocs, and the TTO.

The first discussion to have is with the academic founder. They have contributed to the scientific project, but their role in the future company will likely be tangential. Unless they are willing to step away from their position and into the newly founded startup, their ownership should be mostly symbolic.

It's a tough discussion, mostly because professors tend to overestimate the value of their contributions.

Outside of academia, no one will contest that the value of proper execution trumps the value of any idea.

Many senior scientists will not agree with me, but I believe that keeping at most a 5% stake in a startup, plus a role as an advisor is more than enough. Senior scientists are also part of the licensing agreements, so there'll be money flowing their way and they are not taking any risk whatsoever.

Moreover, it's important to understand the long-term value in the company. Professors are focused on science progress, and they should stay that way. Shares in companies give raise to many conflicts of interest. The value of the academic founder may lay in their network and, in some cases, their prestige. A company spun out from a Nobel-Prize-winning lab has an exposure level different from that of a lab of an early career researcher. But that's pretty much it.

Another possibility is the university requesting shares as part of the spinning out process. Mandates and internal regulations are not something you can change in whim. But it's a discussion worth having nonetheless. Unless the university becomes an investor in the company, there is no reason why they should receive any shares at all.

If they care about receiving money back, after financing research for so long, they can sign licensing agreements.

Universities are slow to react, and don't bring anything new to a startup. Too much greediness will only stumble the development of the company.

I have seen companies very happily giving shares to people who stayed 6 months as part of a graduation project. Long term, managing a large pool of shareholders will be a nightmare, and it'll create many concerns with new hires regarding the value of their contributions.

If you think some of these graduates will stay involved with the company, you can create so form of vesting structure, where shares are accumulated over time only after they've completed a minimum amount of time engaged with the project.

Finally, there the role of early investors. Regarding of how much I can write about it, you'll need to decide what you think is best for you and for the company.

Professional investors know what they are doing, and will want to keep entrepreneurs engaged for the long term. They'll give just enough shares, after all they'll act on their own interests. However, professional investors may not be aware of the relationship between academic founders and scipreneurs, and that discussion needs to happen on a different plane.

Non-professional investors such as angels, can have many motivations and may not have given deep considerations at the meaning of shares ownership.

A way of delaying the discussions is by organizing a convertible loan, a very popular instrument for early investments. It's essentially a way of investing in a company delaying the conversion of that investment into shares until a later future in time, when the value can be more accurately determined.

Splitting shares is an important discussion to have among founders. It'll trigger interesting insights onto how other people see the future, their long term objectives, and their personalities.