Ten Tips for Finding Your Co-Founder Match (and Do I even need a Co-Founder?)
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Finding the right Co-Founder can seem daunting! After all, you’re probably going to spend more time with this person than a romantic partner. So it’s got to be the right fit — it’s pivotal to business success…and personal happiness!
Here we answer some of the most common questions related to finding the right business partner, starting with, “Do I even need a Co-Founder?” And we provide some tips, tricks, and exercises to help you run a smooth and successful recruitment process: from where to find them, to how to make yourself an attractive Co-Founder, and how to have that tricky conversation around splitting equity.
Do you need a Co-Founder? Having a Co-Founder is important for speed, accountability, fundraising, leveraging diverse skill-sets, and having support through the inevitable highs and lows. But we maintain that it is better to have no Co-Founder than the wrong Co-Founder. And the data demonstrates the solo founders do just fine. Techcrunch looked at 7,348 companies that have raised more than $10 million each. 46% of those companies were solo-founded. Even more convincing, of 6,191 exited companies, 53% were solo-founded (link). We repeat, solo founders do just fine!
Do you need a Technical Co-Founder? Many smart people have different opinions on this. Having a technical Co-Founder can allow you to create a higher-fidelity product without significant financial investment. Moreover, investors like it because it may mean that you can build your product and go to market faster. However, we maintain that it depends! The first consideration should be the type of company that you’re building. First Round looked at portfolio companies over 10 years and found that enterprise companies with a technical Co-Founder performed 23% better overall. However, consumer companies with at least one technical Co-Founder underperform completely non-technical teams by 31% (link). The skillset may be more valuable at a Software company, versus an E-Commerce company or a product or service that can be delivered on existing turnkey platforms. For these types of companies, a sales or marketing expert, or someone with deep industry expertise may be a better Co-Founder fit.
If I am looking for a Technical Co-Founder, what should I be looking for? We agree with this article from Krit (link) that instead of digging for a specific title on LinkedIn, look for people who have early-stage startup experience or side projects of their own. In addition, you want someone who can adapt to different roles as the company evolves, so look for more of a generalist than someone with a narrow skill set. Bring on a technical-cofounder if you’re just starting out, could use support in every aspect of crafting your startup, and are willing to part with a sizable amount of equity (up to 50%). If this isn’t you, consider bringing on a programmer hire instead. Or explore other alternatives, including bringing on a technical advisor, doing a technical Bootcamp yourself, hiring a consultant to build the MVP, or working with a dev shop (all of which have their own upsides and downsides).
How many Co-Founders should I have? It depends on the skillsets you’re able to recruit. Two or three seems like the sweet spot. We would not recommend more than four, as you’ll want to be as lean as possible while having all of the skillsets you need to move quickly. And make sure each founder is bringing something pivotal to the table.
What qualities should I look for in a Co-Founder? Listen, similar to a romantic relationship, it’s unfair to assume that one person is going to have it all. But here are some “non-negotiables,” that we recommend recruiting for any Co-Founder: they communicate well; have trustworthy and reliable judgment; have demonstrated a problem-solving mentality; thrive in ambiguity, and are team-oriented. There are likely additional must-have qualities that are important to you. Make sure to include those during the Co-Founder vetting process.
When do I recruit a Co-Founder? Ask yourself the question, “Where do I want to be in six months, do I need a Co-Founder to get me there?” Some founders spend all of their time for a few weeks or even months focused on recruiting their business partners. If you know for sure you will need a Co-Founder who has skills you do not possess, then you should be very serious about your Co-Founder recruitment — as you do not have a company without one. If you’re having a hard time finding a Co-Founder, don’t let it get in the way of making progress.
Continue to find scrappy ways to get traction. The more validation you have, the easier time you’re going to have finding a Co-Founder with the desired skill-set.
How should I go about Founding a Co-Founder? You’re probably going to see this person more often than anyone else in your life, so be extremely thoughtful and deliberate in your process of finding the right fit for the long game. Here is our recommended three-step process for finding the right person:
a) The Search: identify what you need in a Co-Founder and go looking for them
b) The Trial: conversation, more conversation, work on something together, evaluate whether you have a strong Co-Founder fit by working together — then DTR (define the relationship)
c) The Marriage: hard work and consistent communication that goes into building and maintaining a successful partnership
What type of skills should I look for in a Co-Founder? Complementary skills are ideal and allow for separation of concern. Furthermore, when you work in parallel, every founder can focus on their strengths. We recommend scoring your skillset across the following categories and looking for someone who fills your gaps: Product (engineering and design); Industry expertise; Finding customers (marketing); Sales if you’re B2B; Raising money if you want to be venture-backed. **A word to the wise, think about which specific skills are going to get you to your six-month goal. But make sure to find someone that can also play more of a generalist role because you all are going to need to wear different hats as the company grows.
Where can I find my Co-Founder? Do an ideation exercise around these questions to brainstorm channels for Co-Founder recruitment: Are they in my network (friends/family, former classmates, co-workers, LinkedIn, startup program/accelerator/Bootcamp cohorts)? Where do they gather offline or online (forums, blogs, social media platforms, Meetups, conferences, etc.)? Who do they listen to/learn from (How I Built This, Influencers, etc.)? Where do they work/study? (companies, co-working spaces, undergrad or graduate students, professional schools)
How do I make myself attractive to a potential Co-Founder? Keep in mind, building any healthy relationship is a two-way street. You have to be interested in them as a Co-Founder…and they have to be interested in you as a Co-Founder. Be ready to pitch yourself and your business (similar to if you’re doing sales or pitching to an investor). Paint the opportunity (why this? why now?). Demonstrate an understanding of the market need (aka your customer). Show a willingness to get your hands dirty (for example, a potential technical Co-Founder does not want to be you code monkey), show traction, and speak to your super skill (or as our favorite Founder Oprah likes to say “Superpower”)!
A few more tips! Because why stop at ten?!
What do I do when I think I’ve found the right person? If the two of you are not former co-workers and have not worked together professionally, you should work on a project together (even if you’re friends). Testing out your working relationship will provide valuable insight into whether or not you’re a good fit as Co-Founders. At this phase, if you haven’t already, you should state that you’re interested in working with them. Rather than leading with the intimidating ask to be your Co-Founder, consider asking to do a project together. You can be upfront that you want to see if you are a good co-founder fit for each other. If the project goes well, do a Co-Founder questionnaire. Here is a questionnaire template from First Round. The Co-Founder questionnaire is an opportunity to get vulnerable together, align on values, and speak to each of your strengths and weaknesses.
In a recent fireside chat, our friend, Minette Yu, Co-Founder of StoreyLine, shared that she met her now Co-Founder through a customer interview. After continued conversations, Minette asked her to come on as an advisor, which gave the two of them an opportunity to test their working chemistry and passion for the project.
Okay, we are both amped to work together, how should we split equity? Another controversial topic, and one for which we recommend you do more research. In our experience, splitting equity 50/50 is often the best path forward. You’ll have equal skin in the game, avoid resentment, and establish clear expectations of equal time commitment. A typical arrangement will have a four-year vesting schedule, where stock vests in monthly or quarterly increments over four years. If a founder leaves the company before the stock is fully vested, then the company has the right to buy back the unvested shares at the lower of cost or the then fair market value. There is often a one-year “cliff,” meaning that the individual must be with the company for a year to vest the first increment. To prevent future issues, we recommend working with a lawyer to craft an agreement that you’re both comfortable with. We’re big fans of Fenwick & West (link) over at Female Founder School.
How can we build the foundation for a healthy founder relationship? You should discuss how you’re going to split work and decision-making responsibilities upfront. In the early days, you don’t need silos and departments. Everyone can and should be willing to work in different domains of the business, given how resource-constrained you will be. But it’s essential to assign domains to one person as the final decision-maker if there is a disagreement.
Rock on! You’re ready to assess if you want a Co-Founder, what qualities and skills you’re looking for, where to find them, how to assess your compatibility, and how to do the upfront work for a long and healthy business relationship. And for more ongoing support, community, and resources to build your company check out FounderPass!
