May 14, 2014
This post includes extra content from Startup Mixology, my upcoming book on starting up – including how to prepare yourself for the harsh reality and celebrate positive moments along the way. Go here to pre-order the book (due July 8) and subscribe to updates!
Perhaps the most crucial question you’ll ask yourself in the early stages of starting up is: should I have a cofounder?
Your cofounder will do half of the work (hopefully), have a huge impact on your startup’s culture, and either accelerate you or slow you down. That’s why I think this question deserves some serious consideration.
In the startup world, the consensus seems to lean toward having cofounders in your endeavor. You might think of companies like YouTube, Sun, Oracle, Facebook, Cisco, Twitter, PayPal, Apple, and Google, all of whom were started by cofounders (in some cases, several).
Cofounders give each other emotional support, a sounding board for ideas, and accountability partners. Research by MIT professor Edward Roberts (cited in Startups That Work) states that the chances of being “very successful” increased with two, three, then four cofounders in a startup. The reasons? Compared to a solo founder, cofounders pull from a more diverse skill set, can contribute more of their own money (total), and have often worked together before.
AngelList founder Naval Ravikant believes in having two cofounders who have worked together, are a similar age, have a similar financial situation, and respect each other. While one builds, the other can sell. He also believes they need to have a shared motivation for starting the company – that is, money or love. This will help the cofounders make unanimous decisions and avoid office politics.
Y Combinator’s Paul Graham agrees that two to four founders is ideal: he believes you need someone who is technical as well as someone who can focus on the customers and what they want. If you can wear both the technical and customer-focused hats at once, then more power to you – but it might help you get more done if you divide up the roles.
BabbaCo’s Jessica Kim tried both experiences – with and without a cofounder – and she definitely prefers having someone by her side:
“My first company . . . I didn’t feel like I had a true partner in it. Your investors – yeah, they’re partners with you, but who’s on your complete side every single moment?” she says. “With BabbaCo, Christine joined me just under a year after I started a company from my house, and that has truly proven to me that having a partner who has very complementary skills and personality to you can be really, really strong. Christine and I have gone through ups and downs and everything. I couldn’t have done it without her.”
Bottom line: many people believe startups are too much for one person to do alone. This is why, for example, solo founders have a lower chance of getting accepted into Y Combinator. Drew Houston, for one, was accepted to Y Combinator but counseled to get a cofounder. He recruited Arash Ferdowsi, and the pair went on to build a huge company in Dropbox.
Yet there are still people who believe that being a solo founder or “solopreneur” is the way to go. Shining examples are companies like Dell, eBay, and Plenty of Fish, which were started by single individuals. They also focus on the drawbacks of having cofounders, like picking the wrong person. You give someone equity and decision-making power, but you may eventually discover that you “married” yourself to the wrong person.
Mark Suster, a general partner at Upfront Ventures, has spent lots of time being “marriage counselor” to cofounder debates. He advises you to start a company yourself, then bring on a cofounder later for 10-30 percent equity.
The Founder’s Dilemmas explains that solopreneurship is the best choice when the industry you’re targeting is slow-moving, and when you have lots of personal assets (like money and relationships), a desire for control, and no need for external validation from others.
Technology is making it easier for solopreneurs, as advances in technology have created lower barriers and more tools that allow a single founder to handle everything. In the end, the choice of having cofounders or not may come down to your personality and your product.
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