Pros and Cons of Having a Start-up Co-Founder

The aim of launching your own start-up can be extremely appealing. However, when complications emerge, and they will, many entrepreneurs will begin to consider bringing in a co-founder.

Almost no successful start-up was ever founded, setup and launched by one person. So, thinking of bringing in a co-founder or other board members is by no means a sign of inadequacy. In fact, it can have hugely positive effects on your business.

In this article we will explore the ups and downs of having co-founders so that you can move some way toward a decision.

The Upsides of a Co-Founder

Supporting You

Even if you are a highly skilled businessperson, with a comprehensive and well thought out plan, setbacks are still inevitable. Under these circumstances the person most likely to understand your concerns is your co-founder.

The reason being is they, just like you, have not only invested their money into the project but they have also given it their time, energy, and effort too. Of course, you could stick to only sharing your concerns with friends, family, or spouse, but the fact is they are just not going to have the same appreciation of the business as a co-founder will.

Easier Fundraising

Nearly all venture capitalists prefer to invest their money into a scheme that has valid and trusted team as opposed to a single player or “one-man-band” as they used to be known. There are numerous reasons for this, first of course being that they like to know there is more than one head considering the business decisions. Also, they may wonder about the validity of the idea if you could not influence another person to join you with your plan. How then can you expect to captivate others in the future?

Complementing Your Skillset

There is not one person in existence that is an expert in every field: coding, marketing, finances, sales, etc. Even if you are a rare and accomplished genius, you will invariably need someone to assist you, especially in the areas that you are not quite so skilled in.

Nevertheless, to hire qualified staff is costly and time consuming, especially when trying to cover all the missing positions. However, you may be fortunate and discover that at least some of the areas you lack in, can be picked up by your co-founder.

In a perfect world this person will have all the necessary skillsets that fill in your skills gaps and be prepared to place their money into the business.

Better Decision Making

As you will know it is almost always better to have the power of two minds when making difficult decisions or working on difficult problems.

A co-founder will not take your idea for granted, will give you sound advice, will not be overly critical or judgemental and will generally be able to bring something new to the table. The most crucial thing is that your co-founder should not share the same vision or point of view on all issues as yourself. An old Chinese proverb goes; If two men in business always agree, then one of them is unnecessary.

The person you choose must be able to effectively argue with you, challenge your thinking, offer ideas and solutions from another perspective, and be prepared to stand up for what they think and believe.

Shared Responsibilities

Launching your own business is exceptionally time consuming and often requires you to work extremely long hours. Consequently, you are unlikely to have the time to be able to resolve all the issues that may arise.

As an example, imagine that you are having a meeting with a potential investor or client and at the same time, you discover that you have a problem at the office that needs to be addressed urgently. What shall you do? Do you leave and go to the office, potentially losing an investor? Or do you stay at the meeting, knowing that at this very moment in time the there is another problem that needs your attention and might be costing you money?

This is just one instance that displays how important it is to have a co-founder, a person whom you can trust to take the reins in your absence and deal with issues that may occur.

The Downsides of a Co-Founder

Having a co-founder can have a tremendously positive effect on your business, however for every positive there is always a negative to consider. So, what are some of the issues that you may face when operating with a co-founder?

Diametrically Opposed Views

It is great for your business if you and your co-founder have contrasting thoughts on certain aspects, as explained above, this is important. However, when you are on an entirely different page and unable to agree this can become a problem. If you have fundamental disagreements on which neither of you are prepared to move, then this can result in you both being powerless to reach even everyday decisions and having to endure endless debates can ruin your business. If this becomes the case, the best thing you can do is to part ways as soon as possible in order to avoid even more issues and future disappointments, because eventually this will destroy your business.

Work Inequities

Everyone has different work ethics and different working methods. However, if you are working hard daily you will often expect that others do the same.

This can lead to a situation in which you feel you are putting more effort in than your partner. In order to avoid such issues, it is important the everyone’s roles and responsibilities are outlined at the very start of the project ensuring all tasks are divided equally for everyone.

Co-founders are Not Required all the Time

The fact of the matter is you may not need your co-founder every day. In regard to a technical co-founder for example, if your start-up does not require much on the technical side of business you will not necessarily have work to keep a technical co-founder busy.

You may find that your business’ needs are better served by a short-term co-founder. Someone who comes in for the first few years to then take a back seat, be automatically bought out or otherwise exit the business.

So, what is the Best Choice?

After reading the above you may have concluded that you do indeed require a co-founder but are unsure how to go about finding one. There are numerous ways in which you can access co-founders. Firstly, look closely among your acquaintances, business contacts and friends. Using one of them will be an easier choice as they are someone you generally already know and trust. But do consider the ramifications on the relationship should you ever have a falling out.

If you cannot find an adequate person among your existing network, then you can research on countless online platforms or look for a consultancy firm who provides advice on start-ups or one that headhunts specific people.

For more information or to talk with us about anything in this article please get in touch with us today.

Call us on 0203 150 0565 or email info@thealtitudeagency.com