Get the right co-founders: Don’t marry a stranger in Las Vegas
Imagine going to Las Vegas, meeting a stranger that worked in tech, having dinner, and then heading off to the Elvis Presley Wedding Chapel...listening to “Crazy Little Thing Called Love” sung by the pastor dressed up like Elvis…You both say, “I do” and live happily ever after…
You wouldn’t do this in real life so why would you instantly become business partners with someone you just met?
I know what you are thinking: you are a risk-taker, the hero of the movie, the exception... and perhaps brainwashed by movies/podcasts/blogs that only showed the fun side of startups. I have seen entrepreneurs all over the world quickly becoming business partners without dating for a while to get to know each other.
I did it.
And I’m still recovering from the hangover.
I quickly became co-founders with people I didn’t know and approached it as the real thing when it was indeed a summer fling.
My advice? Date before you marry your co-founder.
By dating, I don’t mean romantic involvement with your business partner. Dating can be a project you work on, an event you plan, having uncomfortable conversations, splitting bills for lunch. Pay attention to the big things as well as small: Do they tip? How do they treat the waiter? Are they cheap? Do you enjoy their company? Their ideas? When you are building a venture, your co-founders become the people you see, talk to, and hang out with every day. And I mean every day. Their thoughts become your thoughts. These ideas become actions and actions become your reality. You have to be very intentional on what reality you want to create for yourself and attract the right people.
The Honeymoon Phase
Oh, the love! We all have felt those butterflies, but if you are somewhat like me, you might have also confused butterflies with a fart. In that case, it’s best to not only trust your instincts, but trust the patterns. When you first meet someone, everything seems perfect. You begin to wonder if they are “the one”; they exhibit all the right qualities and say all the right things. Most likely you are still in the honeymoon phase.
It’s not until your first disagreement, the first fight, the first disappointment, the first investment that you get to know them well and you start seeing the person as they really are. You recognize their good qualities but also acknowledge the things you don’t quite like about them, their flaws, the things they need to work on, their lack of expertise. Because, let’s be honest, no one is perfect, but it’s not until you recognize that side of your potential partner that you really know them and accept them as they are. Hopefully, the good things outweigh the bad, and you can start a long-term relationship.
We have been taught to think before signing one contract: marriage. However, when it comes to business, we often confuse one-night stands with long-term love. In marriages, there is at least sex to release endorphins. But doing business with someone you don’t know is like rushing into a relationship and ending up in a marriage with bad sex. Not good.
The Single Dilemma
Back in 2006, Paul Graham wrote one of his famous essays “The 18 Mistakes That Kill Startups” and named being a single founder as the number one reason to set yourself up for failure. As if it was a vote of no-confidence that the founder couldn’t talk any of his friends into starting a business together. This bias against single founders can have negative consequences; I’ve seen a lot of great, passionate single founders getting co-founders out of nowhere one week before applying to Y Combinator just because they don’t want to be discarded for being single. The worst comes ahead when things get more complicated.
This stigma against single founders is the same stigma we have for single people. As a woman in my 20’s and as a founder, I have felt it. You don’t only have to build an organization, but society expects you to find your soulmate, get married, have a fantastic relationship, all at the same time. And if we don’t, there must be something wrong with us.
If a founder is single, they are more likely not to receive venture capital or get into an incubator or accelerator. And research shows that “solo founders take 3.6x longer to reach scale stage compared to a founding team of two”. Yes, building a new venture is hard not only for the number of chores that you have to do but because it’s mentally challenging. And yes, having someone by your side is great, but only if it’s the right partnership. It’s the same if you are in the wrong marriage; if you don’t split the chores 50-50, you are not only responsible for your chores but for theirs as well.
Who to date & not to date?
The truth is that getting the right team for your idea is not easy. It requires a lot of dating. And often, we are not already connected with who would make our dream team come true. We are usually friends with people that see the world as we do that typically have a similar background and the skills we have.
Truth be told, it was not by nature that I’ve become friends with people with different views and a different skill set than me. It’s intentional. Homophily is the sociology term for why humans choose friends similar in background, attitudes and even age. If you are extroverted, chances are you like hanging around with extroverted people, or if you are a programmer, you most likely hang out with other programmers. We need to be aware this happens and be more intentional to meet different people and expand our circles.
Marrying someone exactly like yourself is like shooting yourself in the foot, and I would dare to say that it is worse than being single. Why would you date someone just like you? How are you going to grow, and see things with another perspective? With the same skills, chances are that you like doing the same things. Enjoying the same type of work and become repetitive, at least at the beginning. You will be stepping on their shoes, and they will be stepping on yours. Because you have the same offering to the company.
I recommend that you date people very different than you, that love doing what you hate doing, that have complementary skills to yours, people from whom you can learn from, but don’t date them if they are not aligned with your vision. Date someone interested in solving the same problems you are, but from a very different point of view.
What I’m saying is that if your founding team is business-heavy or technical-heavy, you should consider dating in the pursuit of balance because "balanced teams raise 30% more money, have 2.9x more user growth and are 19% less likely to scale prematurely than technical or business-heavy founding teams".
Where to meet?
Most people ask me how to grow their networks as I’m well known to be a connector. What most people don’t know is that I’m probably the most extroverted introvert they know and being the connector I am now, took time and intentional effort. But like any skill, making true-lasting connections can be acquired. The truth is that there is no one-recipe-fits-all solution, just as no one can tell you where to meet your husband or wife.
I have a business background, and when I wanted to start my first tech startup, I knew I needed a technical co-founder. None of my friends were technical because at university I usually hung out with people with similar backgrounds to me. But I did have 3 engineer friends, and they were starting a startup. So I reached out, talked to them, hung out with them a lot; I even stayed on their couch for a week. Immersive learning. They were starting a company on their own, so my end goal was never to recruit them, but to understand their view. I even taught myself to code. I don’t think it is necessary for anyone to go that deep. But slowly, I started seeing things from their eyes. I even started getting angry when a business person would post on a social media group that they were recruiting a technical co-founder to work for free to build their product. That’s a great example of what not to do. I started to go to hackathons not to meet potential co-founders but because I actually found them very fun and I loved creating things. I started seeing the commonalities between them and me instead of what made us different.
Sometimes we partner to avoid doing things we don't want to do, or we can’t do, but treating people to just fulfill your inadequacies is never a good sign. If marriage worked like this, I would marry someone to cook for me, because I don’t know how to cook. And even though that would be a great add-on, that’s far from the main thing I look for. Just like in your love life, you love the person for who they are, not for what they can offer you.
Why do marriages fail?
To be fair to Paul Graham, he also mentions fights between founders as a common mistake, but I think getting married too quickly and going through a startup divorce is way more common than we want to acknowledge. Did you know Apple had 3 co-founders originally, that Elon Musk has initially been Paypal’s CEO, and that Whitney Wolfe was a co-founder of Tinder? These are different types of startup divorce. The 3rd founder of Apple didn’t fight with the other two; he couldn’t afford to pay the cost of a startup at that time. Peter Thiel end up being Paypal’s CEO, and Thiel and Musk remained friends after that. And Whitney Wolfe had to sue Tinder to get a settlement and then she went to build Bumble.
To understand why startups fail, CB Insights compiled a database with 298 postmortems tech startups that died after raising funding (with around $1.3M in funding).
The third most frequent reason why startups fail was… not the right team.
Not getting your perfect match is very common, and you can get a divorce and correct those mistakes. But going through a divorce in the startup world is draining. I live through one. And call me a romantic, but I don’t think you want to get married thinking, “In case all goes wrong, I’ll just get a divorce.” It’s important to know where you stand and have those uncomfortable conversations from the beginning. What are you going to do if you don’t agree? Are you going to couples therapy? Marriage counseling? Divorce?
Happily Ever After
Before you tie the knot, ask yourself if they are the one you want to work with, the one you enjoy hanging around, the one that makes you laugh when everything else is going bad, the one that lifts you back up, and the one you lift back up. Equality. And sometimes, that one could be yourself.
Yes, you can be single! If you needed any permission to go for it, here it is. If you have a burning desire to solve a problem and still haven’t met your match, why should you wait?
It’s better to start somewhere than never start because you never found the one. Just as in love, some people meet their match at 18 or some at 40. Of course, a high-growth company won’t be built only by yourself, but the real reason successful people start a startup is because deep in their hearts they can’t go another day without solving a particular problem and if that’s you, don’t wait. If this your calling, why you were put on this earth. Go for it.
But, If you want to start a startup because startups are cool, to get rich, pursue fame, raise money or speak at conferences, think again. There are more straightforward paths for that. Fall in love with the problem; the idea you have right now might not be the real solution you end up with. As the book Start With Why says, your “how” can change but your “why” will remain.
And maybe for me, it’s time to date myself for a while, and start my next company on my own.
Fail and fail again until you meet your match and succeed
As I was writing this article I was telling a friend that I wanted to start a new project, and I met this amazing entrepreneur, and we were…WAIT! You’re doing it again!
This is why it’s easy to keep failing and failing again because old habits die hard. It's not about failing fast, or failing for the sake of failing; it’s about learning fast. The next time you fail, learn the hidden message because some of these business lessons are even more expensive than MBAs. And you and I will keep failing until we learn from them.
So, why don’t we learn this lesson right now?
Before giving that special title to someone: your business partner, get to know them well. Understand their values, don’t overlook the red flags, the little lies, just because they have a skill set that you don’t have and you need them to build your product. Be clear on why you want to start this company and attract people that have the same “why” inside them. Be intentional and meet people with different skills that you have. Be open, but don’t ask them to marry you before you know them very well. Date, date, date. Work with them on small things, do a project that requires time, money, and know their work ethics before you say, “I do.”
Are you dating? Getting a divorce? Seeking love?
Questions to ask while dating
I have included some questions to ask your potential partner before getting married (aka signing the incorporation documents). If yo u are thinking about incorporating a new company (C-Corp, B-Corp, S-Corp, or LLC), please have these uncomfortable talks and focus on the values, because those conversations bring up the character in business.
If you didn’t need to work for a day in your life, what would you be doing? If the answer is traveling the world or vacationing, ask them what they would do when that gets boring? If it’s anything else besides the problem you are working on, you are not aligned.
How do you envision this in the next 10 years? What would you want to do with this company? Take it public IPO? Keep it private? Sell it? With what aim? If the answer is to become millionaires, think again.
How many hours of work are you dedicating to this? Be specific as in daily and weekly. Are you willing to go full-time? When? What would it take for you to be full-time?
Do you plan to take a salary? If not, for how long? If yes, how much money do you need? What’s the fair market value for your position? Are you willing to take a pay cut for gaining equity in this venture? After we fundraise, what is the expected salary that you have in your mind?
What p osition do you envision doing in the company? What are the tasks that you enjoy doing most in your line of work? Do you work over the weekends? Are you a morning person or a night owl?
Who is responsible for what? Providing direction? Understanding the customer? Building the product? Getting and managing the money? Etc.? If more than one person is responsible, then no one is accountable.
What are our first investments in the company going to be? Who do you envision as your first hires? For what are we going to use the first-money-in?
How are we going to split the equity? I’ve seen a lot of founders dividing the equity equally, but not the work, so I recommend this tool to guide you in the equity split https://cofounders.gust.com/
What’s the first milestone we need to aim for the big vision? How much are you willing to bend that vision in the future when we get more knowledge? When it’s the point of a no-go for you if this idea fail? When do you quit?
If we don’t agree, who has the last call in the matter?
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