Feuds among co-founders are the leading cause of early startup death (lack of traction is a close second). Sometimes the startup survives, the skeletons of disgraced co-founders are buried, and all the public hears is another great success story. Until the real story surfaces years later, in all its glorious details, through the excruciating record of a lawsuit.

Do you know the backstory of those famous startups? They are more captivating than a lot of fiction people actually pay for.

uBeam: when one founder takes care of the paperwork…

uBeam raised $23M from Mark Cuban, Marissa Mayer, Tony Hsieh, Mark Suster and many more Silicon Valley celebrities. Apart from their technology possibly being bogus, the original founders didn’t quite agree on how to split equity.

Hint: when you let the other co-founder take care of the paperwork, stuff happens…

So Nora Dweck sued.

ubeam-lawsuit
Legal documents are here and here.

You can read the backstory here and here.

Snapchat: the third dude

No need to present Snapchat. How much is an idea worth? What is the right thing to do if what started as three buddies brainstorming ideas turns into a multi-billion dollar company? Do you keep the third dude around or kick him out? And if so, how much is it going to cost you?

Reggie Brown had to sue.

snapchat-lawsuit

Legal documents are here.

You can read the backstory on BusinessInsider here.

Outcome: settled.

Cruise: don’t write an e-mail offering 50/50 if you don’t mean it

Getting acquired for $1 billion within two years of starting your company is bound to make some people jealous. Especially the co-founder you may or may never have had. His name: Jeremy Guillory.

Hint: do no write down that you are splitting your company 50/50 if you don’t actually mean it.

cruise-50-50-agreement

Legal documents are here.

Backstory on TechCrunch here.

Outcome: settled.

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