Having a co-founder help you launch your startup can take some of the pressure off of you, but can you handle sharing control? Think before you jump into a business partnership you may later regret.
When preparing to launch a startup, you should consider whether you want to go it alone or if you want to bring in a co-founder. Having someone to share the responsibilities and risk with may make it easier to succeed. On the other hand, keeping your visions in line and in sync may be difficult at times. Is a co-founder right for your startup?
Beginning a startup is extremely time-consuming and stressful, no matter what industry you’re in. You will likely be working more than 40 hours a week until things start to stabilize. You’ll be all over the place, from developing your product to knocking on doors to make sales to making coffee. Wouldn’t it be nice to have someone help you?
Co-founders usually have different skill sets from one another. A software company might have one founder who is adept at programming and one who is good at business development. By complementing one another, more work can get done by the person best suited for the task, making it easier to complete it and move forward.
Another benefit is that by having a co-founder, you have a sounding board, as well as twice the ideas. Working in a bubble, you never know if an idea is good until you execute it. But by having a partner, you can see what she thinks before investing time and money into your bad idea. Likewise, when you’re brainstorming, two brains are better than one for coming up with new ideas.
By pulling in a co-founder with contacts in your industry, you can open up doors that wouldn’t otherwise be open to your startup. She may be able to move your product into a new industry you hadn’t thought of through her existing contacts.
Working with a partner is difficult, especially if egos get in the way. If you are considering a co-founder, make sure your personalities jibe and that you won’t be fighting for the top dog spot. Even if your goals are aligned in the beginning, there’s a chance that they will diverge at some point, and then you’re left to decide if you want to go your separate ways or duke it out.
If you partner with a family member or friend and things go sour, you may have irreparably damaged a perfectly good relationship. Business and family don’t always mix well.
Two headstrong people can have very different ideas about where to take a business. Will you be the one to step down, or will you force your point, making your co-founder resent you? These are all excellent questions to ask before you’ve committed to what may be a decades-long relationship, for better or worse.
Choosing a Co-Founder
If you’ve decided to move forward with a co-founder, here are a few things to consider:
- Even if your best friend loves the idea of your startup, make sure she’s got business sense and understands what will be expected of her as a co-founder.
- List out each co-founder’s roles and tasks so it’s clear who manages what.
- Ask her to consider the time required to build a business. Is she ready to commit?
- Ask for her resume. It can help you figure out what she’s best at.
- Talk about your startup and your vision, then ask her what she sees and how she would like to see it grow. See if your ideas mesh.
- Take a personality test to see if you’re compatible.
- Sign a Business Partner Agreement to ensure that everyone’s responsibilities and equity are legally documented.
Even if you choose a family member to be your co-founder, go by the book and make everything legal and documented. It’s impossible to tell where your path will take you -- your co-founder could want to exit or could pass away, leaving you with the mess of figuring out assets that will be distributed to his family -- so plan ahead.
If you don’t know anyone who would make a good co-founder, ask others in your industry or people in the startup community if they have recommendations. Look for someone who’s passionate about creating something and who can hang in for the long haul. You also want someone who has skills that will benefit your company. If you plan to sell products, but don’t have a clue about manufacturing overseas, a good co-founder may be someone with experience in this area.