How to pick a co-founder for your business
Lack of team cohesion is consistently quoted as one of the biggest reasons why so many startups fail.
Picking a co-founder can be just as important to your company’s success as having a solid, market-validated idea. With that in mind, here are three steps to finding the right partner for your business and making a decision you won’t have to regret three disastrous years in.
Related: Taking on the role of founder
1. The magic number
Many entrepreneurs see being a solo founder as an unnecessary handicap. When it comes to exactly how many co-founders you should aim for, however, there’s hardly a consensus.
‘Three’s a crowd’ seems to be the most popular credo at the moment. After all, so many great co-founders came in pairs: Steve Jobs and Steve Wozniak, Bill Gates and Paul Allen, heck, even Ben & Jerry made it work.
There’s a pretty good reason why this ‘Bonnie and Clyde’ mentality seems prevalent in the startup world. Reaching a unanimous decision is still fairly attainable in two-founder teams. Add a third and founder politics slowly start creeping in. Internal lobbying, swaying an undecided third or ganging up on the minority vote have been known to wreck even the most stable of partnerships.
Anything more than three is often perceived as almost blasphemous. The common argument here is that having 4+ founders is not only difficult to manage, it also shows a lack of confidence in your product. Also, a diluted equity stake can make investors doubt how motivated everyone in the team really feels. 2 and 3-founder teams have also birthed the most startup unicorns so far, so data seems to be strongly on their side.
That being said, there are still plenty exceptions to the rule, with 4 and even 5-founder teams successfully weathering the initial storm. Bottom line, anything can and has worked. The most important thing is knowing why you need the co-founder(s) in the first place and building a strategy around your unique set of needs.
2. You complete me
Regardless of how many you opt for, you should always look for co-founder(s) with complementary skill sets to your own. Having just another yes man to parrot your viewpoints and abilities isn’t going to do your company much good. Instead, focus on finding a yin to your entrepreneurial yang.
Most startups rally around the idea of having one founder that builds and another that sells. Of course, that doesn’t mean both founders can’t or shouldn’t be technical for example, especially if you’re launching a tech startup. However, one should clearly thrive as a salesman and company ambassador, allowing the other to focus fully on internal matters and product development.
Clearly defining roles for every co-founder also means not having to second-guess each other all the time. While you should foster a healthy discussion on all company affairs, it’s important to appoint a single decision-maker for each domain. At the end of the day, you should trust each other to make necessary judgement calls when you have to, without having to worry about being scrutinised by your significant business other.
Finally, if you’re not a techie and want a developer as co-founder, it’s still important to master at least the basics of coding. Educating yourself on your co-founder’s area of expertise not only helps you have an informed opinion on issues crucial to your company’s success, but it can also be a vital step to hiring the person with the relevant know-how.
3. Friends with benefits
While having complementary skills is important, a co-founder should also be someone you feel comfortable spending countless days and sleepless nights working with. To that end, it’s no wonder, so many entrepreneurs choose to launch a startup with a close friend or two. But how viable of a business strategy is that really?
Although partnering with someone you have an established relationship with has its perks, there are several drawbacks to be considered.
For one, understand up front that you’re putting an immense strain on your friendship. Building a successful product is never a walk in the park, and it’s bound to create friction between the parties involved. While most entrepreneurs think they’re pretty good at separating business from personal, the line tends to get blurry real fast when you’re working 12-hour days (I’m being nice here!) under mounting levels of stress.
You should also realise that being good friends in no way guarantees business compatibility. The amount of work, team effort and skill needed to operate a thriving startup hardly equates to having a pint with your buddies. Even if you’ve done a few hackathons together in the past, it’s nothing compared to a five-year commitment to a single, uniform goal. In the end, while you should certainly enjoy your co-founder’s presence, delving too much inside your comfort zone can prove detrimental just as well.