Of all the sentences I met in cofounder litigation, few appeared as often as this one: "it was my idea."
It shows up in the opening email. It shows up in the settlement negotiation. It shows up, word for word, years after the idea in question has been pivoted beyond recognition. So let us price it properly now, while it is still a conversation and not an exhibit.
The uncomfortable arithmetic
Here is the honest starting point: the idea, as an idea, is close to worthless in equity terms. Not because ideas do not matter, but because an unexecuted idea has no scarcity. The same insight occurs to many people in the same year; the company goes to whoever builds it. Startup lore prices "idea alone" at a token percentage, and the lore is roughly right.
And yet zero is also wrong, and teams that treat the originator with contempt make a symmetrical mistake. The reason is that "the idea person" is almost never contributing just an idea.
What the idea person usually actually brings
Unbundle the claim, because the equity should attach to the components, not the label:
Domain insight. Years inside an industry, knowing where the bodies are buried and which pain is real. That is not an idea; that is a moat, and it keeps paying for years.
Validation already done. Customer conversations, a waiting list, a pilot commitment. Evidence has a price.
Assets. A prototype, a dataset, a brand, sometimes a patent. Those are contributions of property, not of inspiration, and they deserve their own line.
Network and distribution. The relationships that shorten the first two years.
Price those honestly and generously. What should not be priced is authorship itself, the bare fact of having said it first. The idea starts the company. It does not run it.
The premium that poisons
Suppose the team grants a large idea premium anyway: the originator takes sixty percent for the concept, the builder takes forty for the years of execution ahead. Watch what happens to that split over time.
Every month, the builder's contribution compounds and the premium's justification shrinks. By month eighteen, the builder is doing the majority of the work while holding the minority of the company, and can explain neither to himself nor to his next investor why. That resentment is not a character flaw; it is the split's design working as built. I have read the resulting email threads. They do not improve with time.
The correction is structural, not moral: keep any idea-related premium small and attached to the unbundled components above, and put every founder, originator included, on vesting with a cliff. Vesting is the great equalizer of the idea debate: it quietly restates the truth that equity is earned in the present, by staying and building, whoever first said the magic sentence. An idea is a claim on the past. Equity is earned in the present.
Before incorporation, write the unbundling down
At the pre-incorporation stage, all of this is intended equity, which makes the unbundling cheap: a founder agreement can state what the originator actually contributed (the insight, the prototype, the pilot customers), what it is valued at in the split, and that the rest of everyone's equity is earned through vesting. Written down, "it was my idea" becomes a priced, closed line item instead of an open-ended moral claim. That single paragraph has settled arguments I watched other teams spend six figures litigating.