Co-Founders: They're A Wonderful Thing. Indulge at Your Own Risk.

by MediaSquirrel • 14 years ago

55 22 14 years ago

_sentient• 14 years ago

One of the most interesting questions in the whole single founder v.s. co-founder debate, is how having a co-founder profoundly impacts your personal net gain from a given start-up venture.

The way I see it, taking on a co-founder is a form of start-up insurance. You increase your overall chance of success by giving up a huge portion of the upside in that eventuality.

It makes sense that a VC would prefer companies that have more than one founder if they believe it increases their statistical chance of success. Just understand that this may come at the expense of your personal gain, which is of minimal concern to an outside investor.

cwilson• 14 years ago

While I agree, there is also a balance to be struck. The more co-founders you have, the more likely there will be overlapping skill-sets and disagreements which can lead to various forms of failure as well.

From what I can tell, and personal experience, 3 founders seems to be a very good balance.

johnrob• 14 years ago

Your math/point-of-view is intuitive and quite common. However, startups are a game of large multipliers. At any given stage, you're always pushing to be 10X of where you are now. Your long term goal is probably to be 1000X more valuable than where you start out.

Dividing stock amongst 2 or 3 co-founders is a small order multiplier. You lose half or two thirds of the company. Hitting (or missing) the 1000X goal will determine your personal outcome - the amount of stock given to other co-founders, as an input variable, has virtually no comparative effect on the outcome.

a5seo• 14 years ago

I've solo founded, founded w/ a partner but split when we raised external money (and losing 6 figures of my own cash in the process), and founded solo again. This week, I'm signing on to start up something new with 2 co-founders. Here's what I've observed:

- Having co-founders raises your odds of success AND the scale of your outcome (to replicate this, a solo founder would need to raise money quickly and hire up... staying solo too long limits your potential outcome)

- I believe having complementary co-founders will allow me to specialize and kick ass at what I'm best at (being solo meant doing a look of things sort of ok at, but not great)

- I haven't worked with these co-founders before, however, I think it's extraordinarily unlikely to expect to find 1-2 other people who you know really well AND are available AND skilled AND interested in the same space AND complementary. When you see an opportunity, you have to play the cards you have. In lieu of all of the above, the best approach is to work together and "run some cheap experiments" with nobody jumping in until you've decided if you can work together and there's some positive results.

- As a single founder, I felt like my skills were stagnating-- I hacked kludgy solutions to all manner of problems (tech and non-tech) because I wasn't learning from others' experience. Overall I felt extraordinarily out of touch, HN notwithstanding.

Bottom line, for me, the learning, specialization, and upside of having co-founders outweigh the control, ownership, and conflict avoidance of being a single founder.

bretthellman• 14 years ago

"We fought over the scraps" - What was there to fight over?

paulsutter• 14 years ago

You can restore the friendship. In time you should and will.

staunch2• 14 years ago

When you work long and hard with anyone you will come to have truly justified and serious issues with them.

The question to ask yourself is, would you have looked passed those issues if you had been successful? If you would have, then you should be just as quick to look passed them in failure.

jacalulu• 14 years ago

I'm sorry for your experience and loss. I'm sitting here working with my co-founder right now and I couldn't imagine going at it alone. I know people that have lost friends because things have gone bad, but I think the potential to do something great is worth the risk more often than not.

peteforde• 14 years ago

I am surprised that I'm the first person in an hour to say this: I clicked on the link to SpeakerText and it sure looks like a functioning company to me.

I remember when you started posting a lot, and I've always enjoyed your words. I'm just confused, because reading this feels like someone tore about three chapters from my copy of the book.

TL;DR: if SpeakerText is dead, then why is the site open for business?

beatpanda2• 14 years ago

Seriously, SpeakerText's core technology was one of the best ideas I've seen for improving journalism on the web. I had product ideas for them, they were totally on my list of places to try to work at, what happened?

And if they're dead, are there patents? And if not, does anybody want to start a company? :)

MediaSquirrel• 14 years ago

Thanks for the kind words. SpeakerText was acquired over the summer.

Unfortunately, having awesome technology and improving journalism on the web are not the same as being able to make truckloads if money.

abstractbill• 14 years ago

Hell yes. I think the ideal founders are siblings or very old friends; The kinds of people who could never cut each other out of their lives no matter how mad they were at each other. I've come to the conclusion that you're asking for a lot of trouble in accepting anything less than that.

staunch2• 14 years ago

It's not uncommon for siblings or very old friends to have a falling out. Happens all the time.

MatthewB• 14 years ago

I've been thinking this as well.

However, if you don't have any siblings and none of your very old friends know anything about technology/startups, you're kind of stuck between a rock and a hard place. (me)

My old friends are really smart and I'd love to work with them, but when I try to talk to them about doing a startup, they look at my like I'm nuts.

OafTobark• 14 years ago

Make new friends. Great friendships are not base on how long or how well you've known a person, but how well you connect with another. That can bloom amongst new friendship with a little bit of time as well.

I speak from experience. I was in a similar boat. All my closest friends growing up were the wrong fit for doing anything entrepreneurial much less a startup. A friend I met through another mutual friend but rarely talked to turned out to be one of my closest friend and became my previous cofounder. It worked out great.

dr_doom• 14 years ago

Are there any big real world examples of this?

dm8• 14 years ago

Just like long-term relationships, when breakups happen then people never speak again in most of the cases. But are differences that extreme?

dirkdk• 14 years ago

I remember visiting you guys when you were all living and working together in that small apartment with the pool. You were awesome.

Give it some time, you will regain trust in a new cofounder you will run into, and you will drink beer again with your old cofounders.

jordinl• 14 years ago

Don't think I would like to have a startup with a friend... It could end up losing our friendship. It can't be good to mix business and friends.

trg2• 14 years ago

I met one of you guys on the Muni, going down Market, my first day in San Francisco. Can't remember what your name was. Hope you're able to patch things up and keep going, because it sounded like such a bad ass idea.

Co-Founders: They're A Wonderful Thing. Indulge at Your Own Risk.

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