Prenups for founders: How advisors can protect the business

Chip Wilson's divorce is giving financial advisors a billion-dollar reason to raise the prenup with their founder clients.

The Lululemon Athletica founder and his wife and longtime business partner, Shannon "Summer" Wilson, are reportedly divorcing after more than two decades of marriage. Bloomberg, citing a person familiar with the matter, reported that the couple has no prenuptial agreement, though it remains unclear how the divorce could affect the division of their assets. Wilson filed a family-law proceeding in the Supreme Court of British Columbia in April, according to multiple outlets including Bloomberg. 

The numbers involved are large. Wilson owns about 8.6% of Lululemon, a stake worth roughly $1 billion, while Shannon Wilson holds about 1%. The Bloomberg Billionaires Index puts his net worth at roughly $6.1 billion. The couple married in 2002, four years after he founded the Vancouver company. Shannon Wilson was among Lululemon's earliest employees and became its lead designer. 

The case will be decided under Canadian law. The planning problem it exposes, however, applies to any founder. For wealth managers working with entrepreneurs, marital protection belongs on the same list as the balance sheet, valuation step-ups and preparation for a fundraise or exit. The advisor is often the first professional in a position to bring it up.

Why founders should discuss a prenup before the funding round

Amy Drinkard, a partner and client advisor at Steadmont Advisors, said the conversation goes best when it happens early. She pointed to three moments: when a founder forms the company, when they raise capital and when they get engaged. She treats those as planning milestones rather than relationship milestones.

"I'd frame it the same way you'd frame a buy-sell agreement or key person insurance. It protects the business, the employees, and the partners counting on continuity. A prenup is really a decision to have the hard conversation while everyone still likes each other," Drinkard said.

Brittany Hartnett, a principal partner and senior wealth management advisor at OpenArc, said her clients respond best when the discussion centers on shared goals rather than the risk of a breakup. Founders and their spouses often have different financial priorities, she said, and stress tends to widen those gaps.

"We view prenuptial and postnuptial agreements as tools for creating clarity before those differences become points of contention. They are not about predicting the end of a marriage. They are about setting expectations, reducing uncertainty, and helping both spouses move forward with greater confidence," Hartnett said.

Matthew Smart, chief investment officer at WWM Investments, handles the issue inside the broader financial plan. That is especially true when a business makes up a large share of a client's net worth.

"In many ways, we treat marital protection the same way we treat estate planning, insurance or succession planning; you put the structure in place hoping you never need it. A good financial plan doesn't predict that something will go wrong; it prepares for the possibility that something could," Smart said.

This approach echoes how other advisors frame the prenup conversation for engaged clients. Demand is building too: prenuptial agreements have risen 62% over the past decade and now involve nearly 40 million Americans, according to a divorce attorney who spoke with InvestmentNews about rising prenup use. 

How can founders keep business growth from becoming marital property?

As a company scales, Drinkard said, paperwork becomes the founder's best defense. She advises founders to do three things:

• Keep a clean record of what they owned before the marriage.
• Get independent valuations at regular intervals.
• Keep business funds strictly separate from household funds.

The biggest danger is commingling, which means mixing business and personal money. In Drinkard's view, that is how separate property gradually turns into marital property.

"The family-law attorney should come in early and often, ideally before a funding round or liquidity event, not after someone files. The advisor's job is to spot the issue and get the right attorney to the table," she said.

Hartnett recommends setting up a recurring valuation process while the marriage is strong. She said an agreed framework for valuing the company can reduce uncertainty if the couple later separates.

"Growth can blur a founder's separate-property interest, particularly when marital effort contributes to appreciation or personal and business assets become commingled. Protecting that interest starts with documenting the company's value, maintaining clear financial separation, and paying reasonable compensation. Governance documents should also restrict transfers and require spousal consent where appropriate," Hartnett said.

Smart said he wants to learn early how the business is owned and valued, how its debt is structured, and where personal and business finances overlap. That overlap matters more over time, he said, because a company worth little at the start can become the largest asset on the family balance sheet.

"The best time to address ownership and marital protections is before the value of the business makes the conversation significantly more complicated," he said.

State law shapes the stakes. Nine states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin) have community property laws. Under those laws, property acquired during a marriage generally belongs to both spouses equally. Most other states use equitable distribution, in which courts divide marital assets on what they consider a fair basis, which is not always 50/50. 

Already married with no prenup? Start with an inventory

The harder case is the Wilson case: a founder who married without an agreement and whose company has grown since. Drinkard said the first step is a calm inventory of three questions. What was the company worth on the wedding day? What is it worth now? What drove the growth?

That history matters, she said, because growth that comes from the founder's work during the marriage is often treated differently from passive appreciation. The rules also vary by state. From there, she recommends discussing a postnuptial agreement, which is a contract signed after the wedding. Each spouse should have their own attorney, she said, because that independence helps the agreement hold up later.

"A postnup is a harder conversation than a prenup, so I'd lead with what it gives both people: certainty, privacy, and a plan that keeps the company stable for everyone who depends on it, including their children. Then align the corporate documents and estate plan so they all tell the same story," Drinkard said.

Hartnett starts by asking questions, especially about the spouse's real role in the business. That issue may be central in the Wilson case. Chip Wilson has previously credited his wife with playing a key role in building the brand during its early years, Bloomberg reported. 

"We want to understand the spouse's true role in the company because titles don't always tell the full story. Has the spouse been instrumental to the business's success? Could the company continue to thrive if the spouse was no longer involved? Would both parties want to keep working together if a divorce occurred?" Hartnett said.

Smart said his first move is not to tell the client to sign a postnup. Instead, he works out when the business was formed, how its ownership has changed, how much value it has created and how it fits into the family's finances.

"The question isn't simply, 'How do we protect the business?' It's, 'How do we prevent the business from becoming the only asset available to solve a financial problem?' A founder can have significant wealth on paper while much of it remains tied up in an illiquid company," Smart said.

That puts liquidity outside the company on the agenda alongside ownership and valuation. It is one of several items advisors should not overlook when clients divorce.

For Drinkard, the case for acting early comes down to one point.

"Nobody is predicting an ending. You're writing the rules ahead of time so a family never has to fight over them," she said.