I was in a situation similar to yours for several years early on in my career. My co-founder had built somewhat of a prototype in his spare time, and he and I wanted to take it to the next level.
And we did. We launched a private beta, signed a couple small-time clients, and started making money. The product kept evolving, and my co-founder got less and less involved.
I kept pressing him to do the paperwork. We'd made a verbal agreement, which he affirmed many times (I still have the chat logs in Gmail). I trusted him to keep his word for a long time.
After about five years, I found myself suffering through depression, stress, and burnout. I couldn't take it anymore, so I left the company.
As soon as I left, he started to actually work on the business, finding clients and looking for funding and investors, free of the shackles of his promise to me.
The only way you can guarantee your value is to have a formal agreement -- one drafted by a lawyer. I don't know your co-founder, and I certainly hope he's not like mine, but you need to look out for yourself. Even if your co-founder is a stand-up guy, it's not his job to look out for your interests.