Prenup is lat­est must-have for startup founders in love

The Times of India (New Delhi edition) - - Sunday Special -

The young woman in Mon­ica Mazzei’s San Fran­cisco law of­fice was adamant: she wanted a prenup­tial agree­ment. Never mind that the client had barely any­thing to her name. What she had was a bunch of startup ideas.

She and her fi­ancé, who al­ready had his own small tech com­pany, signed a prenup with clear terms, Mazzei said: “The spouse who has an idea [and] starts a business `owns’ that business. It’s their baby.”

A few years later, Mazzei, a part­ner at Side­man Ban­croft, was trav­el­ing through the San Fran­cisco air­port when she saw her former client on a mag­a­zine cover. Her startup had struck gold. Her hus­band’s business had fiz­zled. In Sil­i­con Val­ley, where pen­ni­less pro­gram­mers fer­vently be­lieve their ideas are worth bil­lions, get­ting rich can take pri­or­ity over get­ting mar­ried. Cal­i­for­nia law as­sumes that any wealth cre­ated dur­ing a mar­riage is com­mu­nity prop­erty, which should be split equally in a di­vorce. That’s alarm­ing not just for young en­trepreneur­s but also their in­vestors.

For­tu­nately, a well-writ­ten prenup is a safe­guard against post-di­vorce havoc, which is why more and more young cou­ples are in­sist­ing on the agree­ments, ac­cord­ing to more than half-a-dozen lawyers in the Bay Area and else­where. Long pop­u­lar with older wealthy cou­ples who re-marry, prenups are also be­ing de­manded by en­trepreneur­s who want to keep fu­ture wind­falls to them­selves.

“I am see­ing more and more young peo­ple want to en­ter into prenup­tial agree­ments who do not cur­rently have a lot of money now but plan to have a lot of money some­day,” said Man­hat­tan­based di­vorce at­tor­ney Jacqueline New­man.

In a 2016 sur­vey by the Amer­i­can Academy of Mat­ri­mo­nial Lawyers, 3 in 5 di­vorce at­tor­neys said more clients were seek­ing prenups in the past three years. About half said they’d seen a spike in the num­ber of mil­len­ni­als re­quest­ing the agree­ments.

“Peo­ple’s con­cepts and no­tions of fair­ness when it comes to pri­vately held busi­nesses are chang­ing,” said Mazzei.

Edtech startup White Hat Jr is sup­port­ing this trend. Founded by Karan Ba­jaj, an au­thor and cor­po­rate pro­fes­sional-turned en­tre­pre­neur, it teaches chil­dren aged 6 to 14 the fun­da­men­tals of cod­ing and guides them in de­vel­op­ing com­mer­cial-ready games, an­i­ma­tions and apps. The chat­bot Shau­rya cre­ated can serve as an AI concierge of in­for­ma­tion

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