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Dictionary by pitch.dog
Founder & employee equity · Working

Bad leaver

Also called: bad-leaver status

ELI5

Someone leaves under defined bad circumstances and may lose more equity.

Used in conversation

“The bad-leaver clause is unusually broad.”

Definition

A person leaving under specified adverse circumstances and receiving less favourable equity treatment.

Here “Bad leaver” means: A person leaving under specified adverse circumstances and receiving less favourable equity treatment.

Pitch context

You will see “Bad leaver” in fundraising decks, data rooms, term sheets and investor conversations when the discussion reaches founder & employee equity.

Why it matters: In founder & employee equity, a loose definition can change rights, obligations, approval, disclosure or enforceability.

Caution

Meaning, enforceability and required process vary by jurisdiction and agreement; this definition is not legal advice.

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Sources & evidence · 5

Direct term-level sources and supporting source families.