Ditto. I hadn't heard anyone specifically endorse this before, but it's what circumstance gave me with my startup. It's a good way to do a 2-person startup with no danger at all of a power deadlock.

I've heard the recommendation to never equally share power or you will risk deadlock. Always agree to either have a neutral arbiter or go with the old 51/49 split so that if it ever comes down to it the issue can be decided decisively instead of resulting in delays and over-compromises.

Is it possible that having to use one's 2% majority share to force a decision is just as bad as a deadlock? (as far as affecting morale, a founder leaving, etc.)

We've had the 51/49 split driven into our heads for so long, I wonder if anyone out there can share the ramifications of actually having to use it.

My co-founder and I took a different tack: "50/50 and a quarter".

- 50/50 split on equity

- Decisions are made by consensus when possible (so far, always).

- If we absolutely cannot agree, we flip a coin (a quarter)

- If either of us decides to leave the company, the other must buy him out. So, if we ever actually get to a coinflip decision, we just ask ourselves "do I care about this so much that I'm willing to walk if I lose, or will I live with it?" Whatever the answer is, the decision can go forward.

Do you use the shotgun clause for buyouts? (http://en.wikipedia.org/wiki/Shotgun_clause)

I like this solution. A lot.

Thank you for sharing!

I have no experience with this, but a 49/51 split seems weird to me. It basically means the guy with 49 spends as much time/money/effort as the other guy, but never gets a say? I'd rather be in for 30% and invest less, or something.