February 18, 2022 | 4-minute read (779 words)
A startup's success is determined by several elements, including market demand, a viable business plan, financing and marketing. But putting together the right team — especially the right co-founder — is critical. According to research from CB Insights, disagreements with a co-founder are among the primary reasons startups fail. On the other hand, having the right co-founder on board can accelerate growth.
Let's look at the benefits and drawbacks of having a co-founder for your startup.
Consider the benefits.
#1: Genuine support – Even the most zealous entrepreneur with a game-changing concept can't avoid obstacles and setbacks. A co-founder is probably the only person who can genuinely comprehend your worries and relate to your concerns.
#2: Skill sets that complement each other – One of the most significant benefits of having a co-founder is that you each bring unique skill sets to the table. Having a co-founder on your team means you have two sets of abilities to draw from. It also implies that you don't have to carry everything on your shoulders alone. You can focus on the initiatives you like and are enthusiastic about when you have a co-founder.
#3: Easier time getting funding – Most venture investors prefer to put their money into a company that has a solid team behind it. They feel that if you can't inspire another individual with your concept, how can you expect customers to do so?
#4: Effective leadership – Companies with several co-founders can benefit from a broader range of leadership perspectives. For example, if any of the founders is a woman and the other is a man — or if they are of different ages — each has their unique past and experiences. Two points of view on leadership are always preferable to one, and they may help you manage your people more effectively. You can bounce ideas off one another and double-check that you've covered all the bases.
#5: It's easier to take breaks – Breaks are simpler to come by when a company has more than one person in control. Let's imagine you've been working 60-hour weeks for the past month to get a marketing campaign off the ground, and you're ready for a break. If you have a co-founder, you may take a well-deserved break knowing that someone (reliable and equally dedicated to your company's success) is in charge. When you have a solid partnership, you both get some time off when you need it.
Now consider the drawbacks.
#1: Diverging perspectives on the job process – It's acceptable to have opposing viewpoints on certain topics; in fact, it may be beneficial. But it can be a problem if the co-founders are on entirely different wavelengths and cannot establish a common ground.
#2: Unequal workloads – Conflict can ensue when one co-founder believes they work harder than the other. Before formalizing your partnership, talk through some scenarios that could arise in this arena and how you’ll address them.
Another strategy to avoid co-founder conflict is to explicitly define duties and responsibilities from the start to avoid any overlap. This may be done by signing a partnership agreement.
Before bringing on a co-founder
Apart from ensuring that you and your co-founder share the same degree of ambition and motivation for your firm, here are a few pointers to assist you in finding the ideal partner:
• Define your fundamental values: Before you choose a co-founder, make sure you have a solid set of core principles in place. These will guide your priorities.
• Decide what compromises you're willing to make: Are you ready to sacrifice security or privacy in the name of openness? Are you willing to work late and put your plans on hold to fulfill tight deadlines? Making these decisions upfront will show your possible partner(s) your priorities and what you're ready to sacrifice.
• Determine the qualities you seek: Examine your own business's strengths and shortcomings, and list of the abilities and experiences that would complement yours.
• Look at many options for finding a co-founder: You may use many of the same routes to locate a co-founder as you would to find investors, like entrepreneur forums, industry conferences and business associations.
• Define the responsibilities, metrics and milestones jointly: This approach puts the co-founders' working styles to the test. Starting a business is challenging, so now is the time to commit as a group. If you can't work together today, it's unlikely you can in the future.
• Discuss how you'll deal with adversity
: Cash flow problems, fundraising issues, clients canceling contracts and employee departure are common business problems that will likely affect your relationship. You'll be able to weather the storm if you and your co-founder have a plan in place for dealing with difficult situations.