When does one become a "founder" of a business? For example, would it be when work on the business starts or when the business is incorporated? Such events could be years apart.

  • 1
    "Founder" under what definition? As far as I know, "founder" isn't a legal term and has no strict legal definition.
    – cpast
    Jul 30 '15 at 18:12
  • @cpast, I believe you are right that it has no legal definition or legal value. I should have mentioned this. I was confused where to even ask this question and questioned whether or not it belonged here. I could find no other suitable place on StackExchange, so I posted here. However, I suspect there must be some general understanding of what a founder is, as Facebook had a lawsuit regarding the use of the term.
    – Xonatron
    Jul 30 '15 at 18:39
  • This isn't a legal question. Aug 1 '15 at 2:43
  • I agree but stretch this and help me out if you can! There is something here.
    – Xonatron
    Aug 1 '15 at 2:45

"Founder" is a common term used in the startup community.

The SEC refers to founders in its definition of "promoter":

Any person who, acting alone or in conjunction with one or more other persons, directly or indirectly takes initiative in founding and organizing the business or enterprise of an issuer


I think your question is one of semantics. So the answer depends on context.

For example, if you are chatting with your friends, the answer could be when you start working on a new business idea that you one day hope will make money.

On the other hand, if you are talking to VC investors it might be when you file the legal paperwork for your patent(s) or your corporation.

Semantics depend on context.

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