Founder Series Part I: How to Choose Your Founders
/How can you sink your startup before you ever start? Choose the wrong founders. It sounds obvious, but in practice is remarkably challenging for many startups. In this first post in my founder series based on a class I taught at MIT Sloan recently, I am going to focus on what you need in a team and what you should do without. Companies have taken a variety of methods in putting together founding teams. Some ventures are started by a few old friends. Others are placed together by serendipity. Some go it alone. Companies at one time of another may have found success with each of these. But that does not mean each will work for yours. Before you start, answer these three questions: (1) how many founders do you need? (2) What skills should a founder have? (3) Do the founders share a vision?'
How many founders should a startup have?
First, there is no one right answer to how many founders should be involved. Facebook's Mark Zuckerberg went solo (at least officially), and seems to be doing o.k. Others took a collaborative approach with four or five. To figure out your answer keep it simple - use rules that know from a bar. My favorite analogy for founders is the "martini rule": one is unusually not quite enough, but four of five is likely too many.
The more I work with startups, the more I see that two seems to be about the right number. Three can work, but human nature says that you are inviting trouble. Think about successful companies and inevitably you will associate them with two founding members. Apple, Google, Microsoft, HP, and even newer startups like Foursquare, HubSpot, and Twitter all started with a pair of entrepreneurs.
I have had clients tell me that they "need" this person or that person on the founding team because of a long-standing friendship, or because they want a diversity of views, or even because they just happened to be involved in the early conversations and offered some suggestions. A founding team is more than just payment for past actions (more on that in my next post) and friendships can change very quickly when money and business is involved. Over time, the company will require contributions from many people to be successful, including advisors, but they don't all have to be founders.
What Skills Should a Founder Have?
The one thing that founders should have in common and that is that they are different. Often, two people with similar skills make poor co-founders. The best teams bring contrasting (but complementary) skills to the venture - a yin to your yang.
Keep in mind that you don't have it all. A solid co-founder can be a very valuable partner in your new venture by helping you to stay focused, being a sounding board for ideas, and, simply put, as another set of hands to help manage the workload.
The key to a good co-founder is balance. Each of you will bring different skills to the table that together will help propel the company. If you like to code or tinker with products, another technie might not be the best fit. Perhaps your co-founder should be a businessperson who can help sell your ideas (think Steve Jobs and Steve Wozniak). Again, the complementary skills are key.
Vision
Finally, you need to share a vision with you co-founder. I am not talking about on day one - everyone is excited and in alignment at the beginning. But what about when things change? Do you share a philosophy on dealing with the things you did not intend to deal with?
Many founding teams start to fall apart as things change. They start to argue about what to do when the original plan is not working. Or even worse, refuse to adjust when it is clear that you are headed in the wrong direction.
I saw a promising startup fall apart because they just could not agree on how to deal with an employee (who happened to be a friend of one of the founders). This is when having history with your co-founder becomes important. You will have a better idea about not only what skills they can bring, but also how those skills will help you evolve the company you will create together.
So what has your experience been? What have you found works best when choosing your co-founders?
Read more about founders in my Founders Series Part Two and Part Three.