How to Pick a Co-Founder for Your Startup
Selecting the right co-founder is one of the most important decisions you’ll make when starting a company. According to Fundera, the odds of startup success increase by 20-30% when there are 2 or more founders. Your co-founder must complement your skills, share your vision and values, and be someone you can work closely with during the challenges of building a business.
This guide covers tips for choosing an effective co-founder.
Define Required Skills and Experience
Before searching for a co-founder, outline the ideal skills, experience and strengths needed to complement your own abilities. Do you require tech skills like programming or a business background in areas like marketing? Define necessary competencies upfront.
Evaluate Existing Relationships
Consider teaming up with someone you already know well, such as a friend, former colleague or college classmate. 64% of successful co-founders were friends, classmates, relatives or former colleagues before starting their business together according to data analyzed by The Founder Institute. Leverage existing working relationships and friendships to find someone you align with. Beware of partnering only for convenience though. Carefully evaluate if potential co-founders truly match needs.
Vet Values and Vision
A co-founder needs to share your startup vision and values from day one. Discuss why you want to start this business and key company values around issues like work-life balance. Share your vision for the company's future as well. Alignment in these areas reduces future conflict.
Address Gaps with Advisors
Understand that no co-founder is likely to match 100% of your needs. Fill remaining gaps by establishing a strong board of advisors early on, pulling in strategic experience your team lacks into a mentorship role. Advisors can consult in areas like legal, marketing etc.
Test Compatibility Before Committing
Before cementing partner status, work with potential co-founders first in a trial capacity. Attend events together or collaborate on initial planning/prototypes. 82% of startups fail due to co-founder conflict, so making sure your working and communication styles mesh sets up future success.
Formalize Partnership Details
Once selecting a co-founder, don't neglect establishing a formal partnership agreement covering compensation split (equity percentages etc.) and decision-making details. Defining terms, especially for worst case scenarios like disagreements or one founder leaving, protects all parties later.
Choosing co-founders shouldn’t be rushed into. Thoroughly vet candidates' skills and experience for gaps, verify strong vision/values alignment exists, and use advisory boards to fill remaining holes. Testing working compatibility and formalizing terms sets up your new business for success. With the right co-founder partnership, you’ll be primed to handle all startup challenges.