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The Equity Collective

Our ground-breaking Equity Collective is a unique business model where Founders and their community share in the financial upside of successful peers - giving back is literally written into our process.

When you become a Founder Institute Alum, you become part of our Equity Collective, a model of sharing that allows your local community and YOU to be part of your cohort’s future success. Our idea-to-exit support is made possible by sharing in the financial upside of our Alumni.

More than just a series of classes, FI is invested in your success and your community’s success by literally aligning our business model with your company’s achievements for the long term.

How it works

Contributions

About halfway through each program, companies pledge 4% of their future equity in the form of a Warrant.

Sharing

From that 4% share, any future financial returns from a liquidity event (for example, an IPO) are distributed back to those who helped you, with 75% returned to your local ecosystem to continue the cycle of support.

1 % Alumni
Alumni receive financial upside in the companies in their cohort.
1 % FI HQ
For providing assistance for years to come.
1 % Mentors
For providing feedback and guidance throughout the program.
1 % Leaders
For running the local program and building the FI community.
Please note that Founders are NOT asked to join the Equity Collective to enroll and start the program. Instead, you will be asked to join approximately two-thirds of the way through the program (May 23, 2022 for the Washington DC Virtual 2022 cohort), allowing you to fully understand the value the Founder Institute Network provides before committing equity in your business.

Why Shared Equity?

There are several benefits to the Founder Institute's Equity Collective model.

Ecosystem Collaboration

Everyone you interact with at Founder Institute is aligned with your success in the long term, from your Local Leaders, Mentors, and Headquarters staff. This ecosystem becomes a key driver in your growth, and your contribution becomes the catalyst for the next generation of local founders.

Reduced Program Fees

Other accelerator programs charge up to $40,000 and take up to 10% equity to attend. Our course fees are kept reasonable because our costs are offset by Equity Collective returns. Alumni also access all post-program benefits and Founder Lab for life with no additional fees or equity requirements.

You're an Investor

You share in the financial upside of your cohort peers, making you an early investor in your cohort companies. Even modest exits of $5M can return several thousands of dollars. To date, the Founder Institute has distributed over $8.5M in Equity Collective contributions from our portfolio companies.

Founder-Friendly Terms

The Equity Collective is enforced via a Warrant, which is a stock options-like agreement, and is activated only if you raise a threshold amount of outside capital. We don’t sit on your board or have any voting powers. This structure also avoids tax implications associated with owning equity outright. FI handles all of the paperwork and sends you a check when a distribution is ready.

Frequently Asked Questions

Signing the Equity Collective, along with the corresponding Warrant, is required for graduation.

The agreements can be found on our Agreements page. You may have localized agreements in place for your specific country.

Absolutely. Most chapters work with local legal firms who are well versed in our agreements and can walk you through the process. You are welcome to work with your own legal team to review the documents. We also provide localization of some agreements so they apply to your specific country.

Yes. As long as you have created a viable company, Founder Institute will honor your Equity Collective agreement and provide you distributions from your cohort peers.

Please visit our FAQ page for detailed information about the Equity Collective and the Warrant. Want to talk to someone directly? Attend a live Info Session call or chat with our Admissions Support Team.

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The Founder Institute is the world's largest pre-seed startup accelerator. Since 2009, we have helped over 5,000 entrepreneurs get the focus and support needed to build a business that matters. Based in Silicon Valley and with chapters across 90 countries, the Founder Institute's mission is to empower communities of talented and motivated people to build impactful technology companies worldwide.


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