5 Lifehacks for Startup Co-Founders. How to Stay Sane.
Hi, I’m Jane — the CTO & founder at Welltory. I want to share my story about how to stay sane when you are launching tech company.
If you’ve ever started a business with a co-founder, you know it’s not easy.
66% of companies fall apart due to a conflict between founders, which is why startup application forms from different accelerators will ask you endless questions about your co-founder:
Have you started a business together before?
How long have you known each other?
How do you resolve conflicts?
This detailed list exists for a reason. Venture capitalists realize that if you’ve known each other for a long time, you’ve already been through hell and back together. You’ve butted heads, you’ve argued, have somehow made it out alive, and want to do it all over again.
Still, many successful people advise against starting a business solo. Having a good co-founder means that there is someone to keep you in check, understand you, and share your all of your work responsibilities, problems, and challenges.
I want to talk about our experience with Pavel, my co-founder at Welltory — a preventive health app that measures people’s stress & energy levels with a smartphone camera.
We’re approaching Welltory’s two-year anniversary, we have 300,000 users, and the world’s biggest database of heart rate variability measurements enriched with health & lifestyle data. We help people boost their physical, intellectual, and emotional health with technology and science. You can read our TechCrunch review here.
But back to our co-founder experience.
First, Pavel and I are lifelong friends. We went to school together and have known each other for over 18 years.
Second, we’ve started a business together before. We’ve been through it all — arguments, problems that come up when you don’t properly document your agreements, just about everything you can imagine. We’ve made mistakes, we’ve dusted ourselves off, and we’ve learned from our experiences.
Third, we’ve decided to continue working together because we accomplish a lot more together than on our own.
This post is about how we work together, what makes our relationship productive, and what we learned about creating successful companies after years of collaboration.
One. Founders Day
Every startup has a lot of work that only founders can do: pitch decks, brainstorming new features, etc. If you have employees and a product that’s already on the market, your attention span gets hijacked by an avalanche of tasks that need to get done yesterday. You have too many conversations and make too many decisions. It’s a big time and energy drain.
The problem is that startups are driven by much more than small everyday tasks. You need to focus your energy on what really matters.
Having Founders Day every Friday has helped us zero in on things that are actually important, not just urgent.
Founders Day means that we don’t talk to our team, they don’t talk to us, and we spend the day working on our own tasks, making strategic decisions and plans for next week, talking about what we learned, drafting documents, and doing everything else that only founders can do. It’s one day a week without noise and chaos, and it’s a life-saver.
It keeps us sane and focused on the big picture. It prevents us from putting important tasks on the backburner. Most importantly, having Founders Day means we know exactly where we’re going instead of always concentrating on how quickly we’re getting there.
Two. Day-off and Conflict Resolution Formulas
The internet is rife with advice on the kinds of agreements you need to come up with and write down with your co-founders.
Here’s an incomplete list:
- vesting clauses in case one of you decides to drop everything and live in the mountains in Tibet
- reasons one of you can be fired and what this process would entail
- what each of you is responsible for and what you expect from each other
- how you’ll manage your money (whether or not you’ll pay yourselves, how much, etc.)
- determine what kind of business you DON’T want to build and what your personal deal-breakers are. For example, we definitely don’t want an enterprise company. We just don’t like long contracts that depend on maintaining relationships, and we want to make a product for the mass market and small teams.
- separate your role as a co-founder from your role as an investor. If you’re investing money, document it as an investment instead of handling it within the scope of your relationship as co-founders.
If your co-founder is a reasonable person who is your equal in terms of experience, professionalism, and motivation, you’ll probably end up with an equal share of responsibilities, the same salary, the same vesting clauses, and so on.
The most important thing is to figure out how you’ll make decisions. There are some scenarios in which co-founders are so different (one is sales-oriented while the other is a tech guru, for example) that it’s easy to come to an agreement. One makes business decisions, while the other has the final word on everything tech-related. But even then your responsibilities will intersect, like when you have to decide on a product development strategy.
Your agreement can be that one of you has the final word when it comes to specific issues. Or you can agree that the CEO always has the final say. The most important thing is to have a legal way of resolving conflicts that you will inevitably encounter.
Pulling out your veto card is almost never a good solution. If your co-founder disagrees and you turn out to be wrong, they can end up feeling resentful because you didn’t listen in the first place. Or they might even sabotage your idea. In any case, it’s always best to talk things out.
This is something that’s almost never put into writing, but should be.
You need an instruction manual for talking things out with your co-founder without pulling out your veto card.
We have a separate document outlining the procedure, because we can argue just about anything: marketing tactics, the structure of production servers, investment strategies, etc.
Here are some highlights:
1. We have our own spheres of responsibility, but we consult with each other when making serious or risky decisions.
2. We avoid pulling out veto cards and try to reach an agreement. This isn’t a compromise, but a solution we agree on after considering different perspectives.
3. If we don’t agree and the argument gets heated, we take a time-out until Founders Day. We talk about facts, not opinions. On Founders Day, both of us bring facts and figures to back up our point of view. Usually, the issue gets resolved at this point. Sometimes we can use expert opinions if there aren’t numbers to back up what we’re trying to say.
4. If this doesn’t help but the decision is not urgent, we put it off until later. Giving it a bit of time often clears things up.
5. If that doesn’t work, we agree on running an experiment that won’t break the bank but will help us get some clarity on the issue. Usually, the co-founder who wants to prove their point of view is correct is the one in charge of running the experiment.
6. But if the argument is conceptual and we can’t reach an agreement, then one founder has the right to send the other founder on a day off. This is reserved for situations in which one of us is too tired, too stubborn, or too worked up to think clearly. If one founder suspects the other one isn’t thinking clearly, they can request that the other founder:
Unplug for a day (go offline)
Go to therapy
Take a vacation
7. If it’s a strategic decision and we still can’t come to an agreement, we resort to legal tactics like asking the board of directors or holding a shareholder vote. Of course, minor issues like logotypes won’t make it to this stage, but the formula has to be both complete and completely transparent.
Three. Switch Places.
I’ll say right off the bat that this piece of advice isn’t a good fit for all founders. For us, it was extremely helpful.
At first, Pavel took care of all tech-related issues and I was responsible for making business decisions. He was in charge of iOS, Android, Design, Back-end, Front-end, and QA teams. I managed our Science, Content, Support, Marketing, and Biz-Dev teams. I made a lot of presentations, talked to companies and clients, held webinars, and took care of customer development. In other words, I was the typical business founder. Pavel was a typical СТО.
Then, we made the switch from a service company where the main selling point was a personal analyst who supported users with data-driven recommendations to a product-based company in which our product was a fully automated and scalable app. We had to restructure everything, since we simultaneously shifted our focus from the European market to the US market.
At this point, there two main factors that pushed us to switch places (I became the CTO, and Pavel is now our CEO).
First, even though both of us have engineering degrees and experience in tech and business, our approaches are radically different. Pavel is more system-oriented. He’s good at creating well-oiled machines that operate like clockwork. I’m more creative and good at hacking systems to generate better solutions.
Second, we had already accomplished everything we could in our respective roles by the time we switched. I had already gone through all the marketing channels, and Pavel already had the development team working smoothly.
But our marketing clearly lacked a systematic approach for the US market. The product, on the other hand, needed to be supplemented with a vision I had extracted from my customer development experience because it had to be transformed from a service-based product into a fully automated app.
Both of us were already feeling stretched too thin in our respective roles, and both of us had a ton of ideas on how to improve each other’s work.
So we decided to switch. I came to the development team full of fresh ideas, while Pavel took over marketing in order to give it a systemic makeover.
We saw results in just a couple of months. Our marketing indicators were improving, and we were developing new features at lightning speed. Both of us also got a second wind and started to make visible progress.
Of course, this bit of advice only applies to founders whose qualifications match up in a way that lets them replace each other.
Four. Monthly Reports for the Team.
A startup is always a race.
You have to run faster than everybody else, because that’s your only competitive advantage over big companies and other competitors. You’re sprinting, but have to be prepared to run a full marathon. When speed is the most important thing, you always feel like you’re never fast enough, you want more results, nothing is ever enough, and all of this is exhausting.
The feeling of never being satisfied with your results plagues founders constantly. You want things to be better, faster, stronger.
Monthly reports help.
Once a month, we set up a video conference for all of our team members, where we talk about everything we accomplished over the past month, share news, discuss what we failed to get done, and give an overview of business, development, and investment changes.
Each one of us has a lot of experience with presentations, so we put together a lot of fancy slides. Our last presentation was 103 slides long, and each one lasts for 1.5–2 hours.
Our team gets a lot out of these meetings in terms of motivation and understanding the bigger picture, but really we are the ones who benefit most from the reports.
That’s because we sum up everything we’ve done over the past month, and it usually turns out to be a lot more than we consciously realize. When you take a step back and look at the big picture, seeing everything that got done over the past month, more often than not you think: “Whoa, this was a lot of work!”.
It’s a fantastic feeling. We’re usually proud of ourselves and the results on this day. It’s a big stress-buster and gives us a motivation boost.
Yes, we go right back to chasing speed and results the day after. Still, we take time every month to look back and see how far we’ve come. It’s good for us and for our team, and it’s worth the time and effort you’ll sink into putting the presentation together.
Five. Stay Balanced and Watch Your Parameters.
Being a founder means a lot of pressure, from all sides, all the time. Responsibility, speed, endless decisions that have to be made every day.
Since this is a marathon and not a sprint, one of the most important things you have to learn how to do is stay balanced. That is, you have to be as productive as possible without burning out.
Burnout is one of the main reasons startups fail, and it happens because founders don’t know their limits and end up cracking under pressure.
The product we happen to be developing has already saved us many times. When we’re starting to push past our limits, our stress & energy levels always reflect that something isn’t right and it’s time to take action.
Usually, the other co-founder has to say “Hey, you need to take a break and recover, we can’t afford to have you burn out.” You need this wake up call, because otherwise it always seems like taking a break is impossible, that everything will fall apart if you take a step back for a few days.
But the thing is that recovery is just as important as working hard. Rather, it’s necessary if you want to keep working just as hard.
If you’re working alone, take measurements and pay attention to trends and changes. If you’re not working alone, watch your partner’s parameters and send them on vacation if you see them slipping. It’s the best strategic decision you can make.
Of course, it’s better to not get to this point to begin with. Remember that keeping your body and mind in good shape is a job, just like testing and marketing. A founder’s ability to think clearly is every startup’s key resource. Take care of yourself and don’t drive yourself to the point where stress shuts off your prefrontal cortex.
We hope that our advice helps you stay ahead!