Co-Founder Disputes Kill Startups — Try Mediation Before It Kills Yours
I spoke with a serial startup founder a few weeks ago that clued me on his opinion of what kills startups: conflict at the co-founder level.
Disagreements around the topics of “who gets to decide what, who is working harder, or whose opinion matters most” threaten the very business you are attempting to build.
These issues that co-founders face can simmer slowly for months before coming to a high-boil. The stress of building a scalable product and bringing it to market coupled with the challenge of finding the correct way to communicate all of these worries, without making it personal, can strain the relationship.
Before a disagreement kills your startup, try mediation. Through an impartial third party, known as a mediator, the founders get support for navigating conversations by looking at the issue in the following ways:
1. Separating the Founders from the Problem
It can be hard to stay rational when discussing sensitive issues or problems. Like most people, founders can take things personally, getting angry, frustrated, or even annoyed, which results in cognitive inertia (i.e., the inability to revise past assumptions based upon new information).
This sets the stage for each founder to try to persuade the other to his or her side, without accommodating their partner, and using past behaviors as a litmus test to understand how the other founders may react or decide the issue.
Mediation corrects assumptions such as these by approaching business issues first as people problems. First founders are recognized as regular people and their beliefs, viewpoints, and expertise are acknowledged without judgment or blame. Mediators do this by:
1. Acknowledging perceptions without judgment;
2. Maintaining a communication space that is without blame;
3. Facilitating the calm expression of emotions or negative sentiments ;
4. Calling out conciliatory statements; and
5. Finding common ground.
2. Looking at Interests, Not Positions
The mediator not only informs the mindset through which founders view their problems, but also helps founders to improve how they talk about issues. An example from “Getting to Yes: Negotiating Agreement Without Giving In” illustrates this best:
“Two men are quarrelling in a library because one wants the window open while the other wants it closed. No solution satisfies either of them; neither a crack, halfway, nor three-quarters of the way closed will do. Enter the librarian. She simply asks one why he wants the window open, in which he replies, “To get some fresh air.” The librarian then asks the other the same question, to which he replies, “To avoid the draft.” After thinking about it, the librarian opens wide a window in the next room, which brings in fresh air without a draft, satisfying both.”
Mediation is a process that looks at interests, instead of positions, and asks important questions to get to the heart of why someone wants something. Much like the iceberg photo above, the mediator unearths each founder’s interests which are then used as the basis for the joint problem-solving process that the mediator uses to find solutions.
3. A Collaborative Problem-Solving Process
Much like a brainstorming session, the mediator facilitates a collaborative problem-solving process that is based upon each person involved and their interests.
The founders must commit to work together to get this done because it requires collaboration and a little creative ingenuity so that everyone involved can leave happy.
The mediator structures the conversation, again reminding the founders of their perceptions and interests involved, by looking for the following:
1. Shared interests between the founders;
2. Acknowledging preferences on issues without judgment;
3. Finding opportunities for mutual gain; and
4. Pointing out what is of high value to someone that is of low value to the other.
This produces a range of options that the mediator and founders work through to produce a result that leaves everyone equally satisfied.
Mediation Restores the Working Relationship!
If mediation is successful, the founders’ working relationship is restored.
The founders correct past assumptions and beliefs about themselves and their co-founders are able to articulate positions without blame or judgment. Greater collaboration between the founders results in openness and trust that ripples beyond the mediation session.
Mediation, in the end, could save your startup and let the founders involved get back to doing what they love most: working on the business!.
Bottom Line: mediation helps founders caught in a disagreement by separating the people involved from the issue, unearthing their interests and why they want what they want, and allowing everyone involved to tackle potential solutions without judgment or blame. Don’t let a co-founder dispute kill your startup — try mediation before it does!
Who am I & why should you listen to me?
I am a mediator that specializes in resolving co-founder disputes.
I have brokered high-stakes equity deals between founders, and have coached Co-CEOs in creating strong alignment so they can scale their business ventures. I have found that no two conversations are ever the same, and it really comes down to the founder’s willingness to move forward together.