After writing an article on how to find a co-founder for your startup, Rise My Venture Team present an article on five questions before you bring co-founder. The first question to ask is why you want this person to be your partner. Don’t bring someone on just because you’re in dire need for support — make sure they have long-term potential. The fastest way to land in a failing relationship is by making too quick of a decision to who the yin to your yang is. Of course you are going to like anyone who “says the right things” but just like any relationship, you need to dig further and analyze compatibility. Assuming you’re in the driver seat and have the concept, ask your potential partner to lay out their vision and action plan.
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Also, consider these following five questions:
1. How have they gone about doing similar things in previous roles?
This is arguably the biggest hire you’ll make in order to take the company to the next level, so don’t be quick to take someone who is all words and no action. It will be easier for them to assimilate to the demand of the role if they’ve done something similar before. On the flipside, if you liked them initially based solely on conversation, you may find flaws in their work product which will prevent potential loss down the road. Have them do a presentation that illustrates what they’ve done and that they understand what you want them to do. This could be done through a PowerPoint presentation, an app prototype or other task.
2. What types of metrics do they use to measure activities?
By finding this out, it can result in several different scenarios. One, they measure in a similar format as your company does. Two, they measure results in a different format that could potentially streamline processes already in place. Three, they have no sense of measure metrics which should raise a red flag. Or four, they track the wrong metrics which needs to be discussed prior to them joining you as a partner.
3. What is their time frame and expectations for growth?
Signs of projected growth can help gauge whether they play it safe, risk it all or fall somewhere in between. It’s alarming if they have unrealistic projections of revenue growth without providing both historic company and industry trends, or they may project an impractical surge in new hires, showing the lack of concern for taking the time to find quality talent.
4. How much time has been spent with them?
Spend hours together over many days. Spend half a day white boarding concepts and ideas. Also, ensure you get some social time in together. I personally like going for walks or a hike with someone as you have hours to talk and no other people around. Or consider inviting them to your home for dinner. A partner is a social and business relationship. You’re going to share personal financial information, so you need to like them and trust them. I also believe you need to make sure their hobbies won’t be intrusive. It’s a partnership, so if they are going to be golfing all summer while you’re working that will cause a lot of turmoil.
5. Are you asking them for a capital investment?
If so, you should ask to see their personal financial statements. If not, then they are technically an employee of yours assuming they have less equity if any at all. Don’t take people’s word who you don’t know that they actually have the money they say they do. I take the word partner literally — you should expect them to be transparent and communicative with you. If you are in fact asking them to create a pseudo business plan or spend an inordinate amount of time, you can offer to pay them. Depending on the business and their experience, you may offer $1,000 to $2,500. It shows you’re real and committed.
Having a co-founder can offer an entrepreneur a different perspective, help with the refining of ideas and allow for a sharing of the workload. It might even grant a startup a competitive edge. But there’s no exact formula for finding the right one. Two co-founders might determine that they made the right choice only with the passage of time — a luxury for most entrepreneurs. Several entrepreneurs across the country recently opened up to me about their co-founder experiences and the character traits needed to ensure the best results.
The decision to go into business with someone can happen slowly and not necessarily overnight. Often a co-founder is someone with whom a business owner has already interacted over an extended period of time and found to have a similar work ethic. Test the relationship’s potential by working together on smaller projects similar in nature to the business in question, he adds. In his experience, a trial run can lay the foundation for the business. It’s a success if one individual’s skill set complements the other’s and the project ends in completion.
Most of the people likes to ask the following questions:
“Am I excited to spend the next few years working side-by-side” with the person?
“Do we share similar values?”
Does the potential co-founder “want the same things in the long-term that I do?”
“If the answer is yes, go for it” 100 percent.
That’s key. Both players must ensure that they’re moving in the same direction and have a shared vision of the end goal.
Offsetting complementary strengths.
An entrepreneur moves from “dating” to pursuing a co-founder arrangement when it becomes a priority to find someone who will not only help a company handle day-to-day issues but make a significant impact. Yet truth be told, most ideas take time to perfect. A great partner can help speed up the process. A co-founder adds value by doing more than just pruning an idea. The right partner pushes to enhance the initial project and holds the other person accountable for execution. “Having a partner automatically raises the stakes because if you fail, you’re going to bring him or her down too. Creating a team with varied experiences and outlooks can give a business a better chance at survival — perhaps because a co-founder can serve as a built-in editor, mentor, cheerleader and competitor, all in one, forcing the other person to push harder — if only to not let the other co-founder down. The perfect ally is a person who has everything the business owner needs. “Form a team that has the highest amount of combined strengths. A great team offers the highest probability of surviving and thriving when it seems that all odds are against the pair.
Building a foundation for success.
In the end, “choosing the right business partner is only difficult because it’s not intuitive”. The education system does not teach people to understand or acknowledge shortcomings, which is why problems can arise. The solution is to find someone who’s humble, honest and communicative in order to work through issues — and will hold herself to the same standard — so as to forge a strong and fruitful relationship. Strong relationships are built on mutual respect and the understanding that the players are there by choice. Startups “need to choose their co-founders wisely”. “If they do, it is a major asset for a company.”
This article has been well researched by Rise My Venture team.