It is extremely scary to start a new company. The risk of failure is high and the workload is intense, so it’s not a coincidence that few people start companies alone. However, many companies fail not because of their market, product or finances but because the founding team has a falling out due to interpersonal problems. Choosing the right co-founder(s) is critical to avoiding those pitfalls and boosting your chances of success.
When you are looking for a co-founder (or co-founders), these are some of the questions you should ask:
- Have you worked together before? People behave differently under heavy stress, especially when a lot of money is on the line. Just because you are old friends with someone does not mean you know how they react when things get tough, and in many cases it would surprise you. If you worked together in a highly stressful environment with someone then you know how they handle pressure and you have settled at least a few disputes successfully. Not everyone is ready for the pressure cooker of starting a company and you do not want to learn the hard way that your co-founder is not.
- Do you have the same runway? If you have enough savings to last two years (which I recommend) and your co-founder has only six months, then your company only has a six month runway. That is rarely enough time to prove your idea and test it, so you will be making short cut decisions you might not otherwise make. Resentment will grow in both directions and decision making will become harder since you each have different perspectives. If you have the same runway you will both be on equal footing.
- Do you want the same thing from the business? Never assume that others have the same goals and motivations that you have. People build companies for many reasons including money, fame, curiosity, boredom and desperation. Whatever your reasons, make sure you are clear and explicitly ask your co-founder about theirs. If you are looking to solve a big market problem but they just want to flip a company quickly then you will find yourself fighting over key decisions.
- Do you have complementary skills? Far too many companies are started by people with exactly the same skills. This seems like a good idea at first when there is a lot of code to be written and having two coders is faster than one. However, once the code is written, who will do the marketing, sales, fundraising, customer support, etc.? Bringing on a co-founder with complementary skills gives you a better chance of success by diversifying your companies strengths early. I have seen many teams of engineers write a lot of code and become helpless when their product is not magically adopted by customers. Think about your strengths and weaknesses and find people who are strong where you are weak.
- Do you really, really like each other? This seems like the silliest question but is probably the most important. For any potential co-founder, ask yourself if you would want to be trapped in your apartment with them for a week. You will spend so much time with their person that you really better like them a whole lot.
Even if you can answer yes to all these questions does not mean you will be in perfect sync with your co-founder(s). At the end of the day someone has to be in charge and it needs to be you, the CEO. I agree with Mark Suster who recommends hiring your co-founders, making you the majority shareholder and clear head of the company which helps reduce the impact of co-founder issues.