Top 5 qualities you need to look for in your CoFounder
Finding a CoFounder might be one of the hardest obstacles you will run into. I had to learn the hard way that you should not start a business with just any friend. Jumpstarting on a hunch and good intentions alone, could not only lead to disaster for the business in question, but it could also leave you financially ruined and emotionally crippled for years.
That´s actually what happened to me some 15 years ago with my second business but that is a story for another day. For now some fair words about what qualities you really should be focussing on first, when looking for a co-founder, and the critical warning signs that something might be seriously wrong.
1. Burning with motivation
You should be looking for people that are all action and burning with motivation to start something cool today and not tomorrow. You need to verify your business idea as soon as possible. When everyone is only talking about how to rule the world, but not actually doing anything, then you will never get to dominate the market.
You want people that are not only talking big business but are actually following up with doing the things they are talking about. It´s super important to discuss things and ping pong ideas with others but it´s even better to start building a design mockup or prototype demo and test a live version as soon as possible.
You should also ignore people that want to talk about equity first and the project second. This is always a sucker-punch. Stop talking to that person right now and find someone else that actually is eager to prove her worth first by doing something instead of talking about money or compensation first. Highly motivated co-founder candidates care more about bringing the cool idea to life right now than splitting equity or monetary compensation. You can always do that later when you have a better understanding of that person´s real value for the business.
2. Laser-focused on just one thing
It´s cool to spin up ideas for world domination. I totally get it, I always enjoy that very much. But it might become a big problem if people are always unfocused or even over-motivated and keep rushing through totally different startup ideas every few minutes and cannot focus on a single thing.
Of course, it´s important to keep brainstorming and be able to pivot and adjust the product when you learn new insights or opportunities in the market. But if you are not careful that approach can lead you astray. Nokia started out with a paper mill then later sold car tires before breaking into producing smartphones. Unless you want a company history like Nokia that might be a bad idea.
3. Time to work on the project
It´s always a big problem when team members come on juggling many projects at the same time or need to pay the rent with a flock of other gigs. I know that this might be the default for most bootstrapped startups, but you need to make sure that the person in question is able to dedicate at least 25% or 10 working hours of his time per week to the project. Especially, when it´s a mission-critical skill that no one else can replicate you will need to find a reliable partner.
If it’s not possible that this person at least dedicates this minimum amount of time, then better go looking for an alternative or she will slow down the whole team and have you always waiting to keep up. That will only frustrate the rest of the team. At one point you need to make a decision to lay down that person before she finally realizes it themself and might throw the towel in the ring. This will leave you with a lot of time lost and the mission still unaccomplished. You still need to go and find another person anyway, so better do it right the first time around.
4. Easy communication
This one is not so easy to spot, as it might be widely accepted that people can work remotely and may come from totally different parts of the world and thus not everyone is a natural speaker of your language. Even so, there are certain expectations to meet as responding to questions in a timely manner and explaining issues as they might occur in an easy to understand language.
It might be best to set up a central communication platform or project management tool that handles all questions around the business. Everyone needs to have access to the important parts that she is assigned to and everyone should be able to follow up on any topic. I find Airtable to be an essential business management tool because it has so many templates that can be used for a lot of different aspects of your business.
It´s a problem if there are always misunderstandings of what exactly a product should be doing and how it should be developed. It´s also a problem if you are running into roadblocks because someone is not able to properly explain an issue or communicate potential problems. The best people are able to offer to discuss a workaround solution whenever they encounter a potential problem.
Another important issue is when a team member is constantly communicating wrong information about the project mission and setting false expectations in potential partners or customers. This will always create unnecessary friction and lead to long discussions and distrust in the team and the project. Avoid this at all costs and set a strict mission information base and roadmap, that everyone can easily refer to and stick to.
Most startup founders don´t realize that this is especially critical when hiring new team members that are new to the game and don´t have the same history and project background that you have.
5. Complimentary skillsets
I always thought that one might be obvious, but you might be surprised that most startup teams are actually made up of the same overlapping skillset with huge gaps in the business setup. And I understand it. You take the same classes at university together, you hang out a lot with the same type of people that share the same experience and don´t mingle that much with those other nerds that are talking about things that you are not interested in and maybe don´t even want to understand. Let them do their thing.
As understandable as this might be, it´s not a good idea to start any project with three people that share the same expertise in just one business field. May that be three software developers, three business students, or three salespeople. This will mostly lead to an imbalance with too much expertise in just this one area of interest, but leave wide open gaps of uncovered fields in other important areas to build and grow a business.
You will notice that startup accelerators and investors are looking for a complete team, which should best be made up of people with skillsets that completely close these missing gaps.
Your average startup team should be made up of co-founders covering the following expertise:
A product developer with an in-depth understanding of the industry, the cutting-edge tech standard of the product, its development process, sourcing of the raw materials or technological base, and the shelf-life or lifetime circle.
A sales/marketing person that is well connected in the industry or with a successful track record and experience selling similar products. She should know how to identify, find, and approach the ideal target audience and be able to establish a repeatable sales process that is easy to scale.
A person with business education and background in financial management that is able to write the financial plan for the whole business. This includes budget planning for hiring people, producing the product, and predicting the costs of selling it with paid advertising for various scenarios. She must be able to calculate product margins at scale, identify and develop new opportunistic business models as they arise, and hand it over in a controllable format to the tax authorities. In most cases, this person will also be responsible for raising governmental funding or applying for any kind of external investment.
The 10 most critical warning signs something is off:
Everyone in the team has the same skillset.
There is only talking but no-one actually does anything and the project is going nowhere.
Someone wants to talk about equity first and the project second.
No one in the team can calculate or understand a financial plan.
There is no repeatable go-to-market strategy.
There is no one that can build the product.
There is much talking about how easy it is to do, but nothing ever happens for weeks or months. I needed to double up on this one to imprint the importance of it ;)
Everyone is too busy with other stuff and does not have time to move anything forward, breaking out the rest of the team.
When applying for any form of credit, funding, or investment and your financial partner tells you that a team member is not credit-worthy.
Finding out one of your team members is wanted by the police.
Some of you might start rolling your eyes now. But Thorsten, isn´t all of that super obvious? No, it is not. Especially, when you are working with your friends. But everything on this list actually happened to me in one or the other startup over the last 15 years!
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Thorsten Hunsicker is a serial entrepreneur, multichannel eCommerce and online marketing expert for more than 15+ years, home office junkie, and proud dad of two super kids.
AXE THE TRASH is the companion blog for both my startups FakeScouts.com - Never buy a fake product again and ViSPR.net - a do-follow backlink exchange network for partner pages that solves SEO for people that don´t like SEO in a heartbeat. So make sure to check them out ;)
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