Founder preferred stock, often called FF preferred or Series FF, is a class of shares issued to founders at formation. It behaves like common stock in every way but one: when the company later sells preferred stock to investors, a founder can convert some FF shares into that new series and sell them to the incoming investors.
It existed to solve a valuation problem. Founders often want some personal liquidity once the company is doing well, but if an investor pays $5 for a founder's common share, that sale becomes evidence that common stock is worth $5, which can push up the 409A valuation used to price employee options. Selling preferred instead avoids the problem, because preferred stock is understood to be worth more than common. FF preferred gave founders a ready-made route: convert, sell at the round price and leave the value of common stock alone.
It is rare now for several reasons. It works only if it is created in the original charter and the founders buy FF shares at the start; adding it later causes its own valuation problems. Even with it, founders can sell only if the new investors want to buy, and investors usually prefer their money to go to the company. Founder sales of ordinary common stock in a financing have become routine, and valuation advisers are comfortable treating them separately from the 409A analysis. And it adds complexity to the charter and the cap table for a benefit many founders never use.
Corply does not issue founder preferred stock. If personal liquidity is an important part of your plan, talk to a lawyer before you incorporate.