You’re ready to start your own business but there’s one big decision to make: whether to co-found or not. Actually when you look at most of the successful startups like Airbnb, Dropbox, Stripe or N26, they’re all founded by more than one person. This goes as far as you can’t even apply to lots of programs when you’re a Solopreneur. While there are lots of things that are harder as a single founder, there are also things that are a thousand times easier when you’re alone. In this article, I’m turning a light on both sides, so you can decide what choice serves you best.
Being a founder can be lonely
As a founder you have hundreds of decisions to make each day, of which many aren’t easy. It starts with small things like which color to chose for the buttons on your website to major things like whether to expand into a different market or not and most of the time you’re no expert in it.
As a founder you cannot try to micromanage every single thing within your company. When you start out, you undoubtedly need to handle everything yourself or within your management team but things are getting tougher the more you start to grow.
One thing is for sure: you need an amazing team that supports you along the way!
Don’t even try to handle everything on your own, you will burn out faster than you can imagine and your dream of being an entrepreneur can soon turn into a nightmare of to-do lists, customer calls and so on. An amazing team is crucial to your success, but do you need to have a person taking on responsibility for all of it, a co-founder?
From my experience, that depends mostly on two things, the company that you want to build and your personality.
Do you consider yourself being a responsible person and do you like have things your way? Does it bother you to talk things through multiple times because you already know what you want? Then being a Solopreneur could be a good fit for you.
Let me explain what a Co-Founder actually is
A Co-Founder is not just somebody that has shares on your company but also a person that will shape the company greatly. That means, whatever kind of person your potential co-founder is, will be reflected through the company. At the same time co-founding can be quite a similar experience as getting married. One difference is, you’re not only financially intertwined but also spending almost 24/7 with each other. Every significant decision you need to make, has to be talked through with your co-founder and the other way around in order to prevent bad surprises later on.
Let’s talk about the good side of having a Co-Founder:
- As you sometimes have to make unpopular decisions, your Co-Founder knows what it feels like, which is something very different from your relationship to your employees
- You can consult each other and talk things through
- Shared knowledge about more topics
- You can support each other in difficult times
- You can balance your time better, when you’re taking a day off for example
- Each of you has their own expertises and way of thinking
- More creativity through more diverse thinking
- Together you have a larger network which can be very helpful
But there are also negative sides
- You need to share profits
- You need to consult about many decisions, even small ones
- It takes much longer to make a decision
- You can not act as freely as a Solopreneur
- There is huge potential for conflict depending on your personalities
- In case of a split up later on, you need to pay the other one out
- If you’re not fully aligned this can lead to lots of misunderstandings and confusion with stakeholders and employees
- Personal conflicts can cause the entire business to collapse
Why do you want a co-founder?
What is the reason you’re thinking about founding with another person? Is it merely to share responsibility (especially of something goes wrong) or do think you could truly benefit from the other persons knowledge? If it’s just about sharing responsibility I am sorry to tell you that this is not a strategy that will work out. As you know, my number one rule for becoming a successful entrepreneur is to take full responsibility for your actions and the success of your company with the concept of extreme ownership. That means, even if you seem to share responsibility this is no way to get out of the extreme ownership principle. YOU are the only person that should consider being responsible for actions taken, no matter who’s on your team or board. Choosing to co-found just so you can blame someone when something is going wrong is no option.
The latter strategy is the only considerable option for onboarding a Co-Founder as that’s the only thing that will actually support the growth of your venture and truly benefit the both of you.
If you’re clear about your intentions, you can start considering if the other person fulfills your expectations.
What kind of co-founder do you want?
Let’s consider you’ve chosen to want a co-founder the question is who it is going to be and let me tell you, this is not an easy choice to make. Your highschool best friend might understand you perfectly well but think about why you want a co-founder: so that your business can benefit from it! Otherwise you can call your friend when you need personal advice without getting professionally intertwined, your friendship might es well benefit from this way of support a lot more. Co-founding for most friendships is a tough test. You’ll not have the same opinion the whole time so what’s needed is a clear understanding of your tasks and responsibilities. No matter who you’re founding your company with, a clear understanding of how the work is devided, how much time each one will invest and what happens if things won’t work out is crucial to sort out before you start working together. Over and over again I see how friends found a company together having a friendship for years but once it gets to the money part oftentimes things change tremendously and that’s absolutely normal.
The more alike you are the less conflict there might be, at the same time you want your company benefit from the different fields of expertise your co-founder has so typically the ideal co-founder looks something like this.
- Preferably you’ve known them for quite a while and you’ve worked together already
- You know you can trust them as you’ve experienced them to be a responsible person knowing what they do
- They’re relatable to you, you can talk to them about difficult topics and you can trust them with your insecurities
- They have expertise in a field where you don’t
- They have skills that you don’t
- One of you is rather analytical while the other one is rather creative
- One of you keeps the overview while the other is focusing on details
Even if you’ve worked together for a while, founding your own company is a completely different thing so always strongly suggest to start working together with a trial period of at least 3 months. Setup an agreement you both sign where you define that no matter what the outcome of this period might be, both of you can decide to leave the project or decide not to work with the other person without having to pay for the time invest. That in my opinion is the most risk-free option to test whether or not you’re a team made for each other that excludes unfair investments or disadvantages either party.
What if you decide to go for the Solo option?
Be aware, that founding alone will be an opportunity for you to grow massively if you allow yourself to by taking extreme ownership of everything that is going to happen.
Founding solo doesn’t mean that you won’t need support, you’ll need it even more. That is what your support circle is for. A support circle is a group of friends, family and mentors you can deeply trust that will accompany you on the way. When becoming a founder, in my opinion that is the most accurate test for any relationship as you probably won’t have as much time, energy and focus left for the things you used to do before. You’ll be faced with fear, you’ll probably face some obstacles you might be wondering if you could handle them at all. The support circle is there to support you through the journey. They don’t need to be entrepreneurs, they don’t need to be going through the same thing, actually it’s helpful to have friends with a stable personal life so they’re able to be there for you and listen to you whenever you need an open ear.
Decide to ask at least one friend if they’re willing to give you mental support along the way. This is not an invitation for you to call them when you have even the slightest problem but gives you the security of having someone to talk to if you need it. Make it clear that you don’t expect them to give you any advice, but quite the contrary, you’re thankful to have an open ear, rather than any advice
It’s your opportunity to grow
Both options founding solo or co-founding are a great way to grow personally as you’re faced with completely different things along the way. While you might be overwhelmed sometimes by having to make all the decisions yourself when founding solo you might be learning a lot about leadership and building rapport when founding with someone else. I have done both in the past and have chosen to make this decision completely dependent on the project I am starting.
There’s just one thing I want to tell you again when founding with someone else: when it comes to the right person, you can’t be too careful. Founding with the wrong person can cost you not only money but also time and valuable energy you should invest in your company. When I was looking for a co-founder for one of my startups I once thought “I don’t want to be too picky, he might have great talents, I don’t have” and founded a company with a guy that did absolutely not understand my vision of the product. This lead to us freezing the product for 6 months until we could decide how to proceed, you can’t imagine how much money this actually cost us.
