This is the fourth part in a series celebrating Entrepreneur First’s 10th London cohort. Alice Bentinck, EF’s cofounder, shares a write up of her fireside chat at Slush on building teams from scratch.
Online dating has become the default way to find a romantic relationship. It’s moved from being an abnormal curiosity, to a mainstream and efficient way to find a relationship or hook up. “OkCupid” is the 38th most-mentioned word in New York Times wedding announcements this year . You can’t get more mainstream and efficient than that…
And early data shows that marriages from couples who met online are more likely to survive the first year. It’s claimed that online dating is behind the rise in interracial marriages as individuals meet people from outside their friends and family.
Why should potential founders care about the rise in online dating?
Online dating removed the transaction costs involved in finding a partner. We know that these same transaction costs are present when you try to find a cofounder.
It’s hard to find someone to cofound with and when you do it’s hard to test how good they are. Alex Crompton, who runs our Singapore office, talks here about the cost of starting a company with a stranger.
At EF, the same principles that have made online dating the norm, apply to finding your cofounder.
But, the most successful companies are built from organic teams?
Yep, historically that’s what the data shows. Kat Manalac from Y Combinator spoke at Slush about how the majority of their successful companies were from cofounders who met during their education (school or university). That’s no surprise. If you look at the chart on where people met their spouse in the 1980s it was through friends, or in a bar, when there were no other options.
Successful organic teams are a legacy because there hasn’t been an alternative and effective way to meet a cofounder.
Online founder dating sites have been around for a while, but they are ineffective. It’s too hard to screen for commitment and skill. It only removes one transaction cost — search.
Founders need eHarmony, not Tinder
eHarmony is wildly successful. Why? They removed the search transaction cost, but also the evaluation transaction cost. They appeal to those who want a long term relationship and they screen results to show those with the highest chance of being a good match for you. You can see how they do it here.
How successful? Check out these outcome stats for eHarmony:
- 71% of women and 69% of men meet their spouse on eHarmony within a year
- eHarmony is responsible for nearly 4% of U.S. marriages
- eHarmony divorce rate: 3.86% — National U.S. average: 50%
It’s not only efficient, it’s more effective than traditional ‘organic’ dating.
A critical mass of outliers
EF operates like eHarmony. We have a team in house that reaches out to 3,000 potential founders every six months. From this pool, we then screen and select the very best 100 in London and Singapore. We screen them for commitment, skill (predominantly technical), intelligence and insightfulness. Often when people join EF, it’s the first time they have been surrounded by a group of people who are so similar to them. It’s a critical mass of outliers who are all ready to build a startup now.
And it works.
We have built more than 100 startups in this way. More than two thirds have raised at least a seed round and our median round size is double that of Europe (raised when our companies are on average 9 months old).
And how many of those teams have broken up? Three.
When you form your team at EF, you have the opportunity to experiment with different cofounders. You have the opportunity to find the right match for you. Individuals experiment with up to 4 cofounders during our eight week team building period. Due to careful screening and cohort composition, it works fast. 50% of each cohort finds their cofounder within the first two weeks.
Inorganic team-building will create teams that couldn’t exist otherwise
Team-building with a stranger may feel weird, but we are seeing exceptional individauls convert to this as an efficient and effective way of finding their cofounder. We’re even seeing more company builders based on the EF model pop up all around the world as demand grows.
Inorganic team-building gives more choice and better outcomes. It will soon become the norm.
If you’re interested in trying a new approach to finding a cofounder, you can find out more here.
 The EF median seed raise is £892,000 ($1.2m), compared to the European median raise of £492,000 ($500k) according to CB Insights.
Alice Bentinck is Co-Founder of Entrepreneur First (EF.) EF runs full-time programmes that fund the most talented scientists, engineers, developers and industry experts to find a co-founder, then helps those teams grow their businesses and raise funding. We’ve built >200 companies worth >$1.5B so far.
We currently run programmes in London, Paris, Berlin, Singapore, Bangalore and Hong Kong, you can apply here or sign up below to get advice from the EF team on your startup journey.