Ah, a business romance. You meet that special someone. Feel like you have a connection. You really see eye to eye and share a vision for a startup. You partner with them, and the relationship blossoms into a successful venture. Reality check: the divorce rate for business partners is 80%. Things go bust thanks to a crumbling relationship.
Just ask Eduardo Saverin and Mark Zuckerberg, co-founders of Facebook and best friends at Harvard. Saverin was Facebook’s first CFO, but disputes over company direction and his lack of commitment led to a messy breakup. Saverin was reportedly an absent co-founder who gallivanted around New York while Facebook was taking off in Silicon Valley. These disagreements led Zuckerberg to slash Saverin’s 34% ownership to just 2% (worth $9Bn today) and his label as co-founder was dropped from the company’s history. Messy.
Recently we’ve seen the nation’s favourite partnership – Phil and Holly on Good Morning – on the rocks, playing out like any co-founder dispute. Of course, there are other matters for our country to address, but this is the one that really matters. This Morning is lying in state on a catafalque. To the perennial largesse of unwatchable daytime television, it’s drawing the rubberneckers as the co-presenters ‘battled on’ despite reports of a serious rift.
I’ve never watched the programme, but these daytime chat shows are void of anything vaguely relevant, and often have the feel of a hostage video. I can’t see how you can segue from an item about Alzheimer’s to a chicken traybake recipe. For a pair who pulled in £730k each for four days a week, it’s just bonkers. But fortunately for us all, the partnership was terminated over the weekend as Phil resigned. Holly will have more room for herself on the sofa.
It’s not an exaggeration to say that hooking up with a new partner in a startup is just like getting married. You embark on a joined-up hope-fuelled journey towards a bright and optimistic future. But the coming together of a couple as man and wife or co-founders can go either way – belonging and soul mates for life, or a flash in the pan, before the start of melancholic, wet winters of recriminations, slammed doors and watching TV together in silence?
Marriage has no guarantees. If that’s what you’re looking for, buy a toaster from Argos. My wife, Susan, and I have been married for 37 years, and not once have we had an argument serious enough to consider divorce. Murder, yes, but divorce, never. We always hold hands. If I let go, she goes off and buys expensive clothes.
But like a great spouse, great co-founders can make even the worst times feel fun and bearable, they will sit with you at the bottom of the pit on your lowest day and tell you that it’s going to be okay. This relationship can determine the success of your venture. When you co-found a startup, your lives will inevitably intertwine, and as in marriage, you have to have each other’s backs. So, my advice is chose a co-founder like you’d chose a spouse.
We all know the tech co-founder duos – Larry Page and Sergey Brin at Google, Steve Jobs and Steve Wozniak at Apple, Bill Hewlett and Dave Packard at HP. I’m also an advocate of Stripe, founded by brothers Patrick and John Collison, an internet payment procurer which allows companies to process online payments from customers quickly. Handling almost 5,000 transaction requests a second, it takes a cut of 1.4% and a flat fee of 20p per transaction. The target valuation of Stripe for their 2023 IPO is $50bn, making it the most valuable private company founded in Silicon Valley. However, this is a downgrade from their original target of $90Bn as recently as March, showing that the tech market is still fragile.
It’s all a far cry for the for two brothers from the Tipperary village of Dromineer, population 100. The pair grew up in a house that was not even connected to the internet for the first decade of their lives. Ready access to books and an encouragement to read voraciously led to a love of computers, an interest in coding, and to the boys’ first investment pitch: encouraging their parents to install a German satellite internet connection so they could continue their computer programming education. It was successful and yielded a good RoI!
There’s nothing like sharing a bedroom and backyard football games to reveal someone’s true mettle, which is why the brothers have worked as co-founders. They’ve had each other’s backs, built each other up needed it, given each other flexibility when required, and made it together. Sorry, no rivalry or revenge stories to report, like a perfect marriage. Patrick Collison has nothing but kind words to say about his brother, joking that he’s determined to be the one in the family to make something of himself. He’s a better version of me.
But back to choosing a co-founder as you chose a spouse. When you know someone well, you have a fair idea of how they operate, how they’ll respond under pressure, their strengths and weaknesses, their dedication, their ethical fabric. In many ways, there should be no big surprises. It shouldn’t take the rough and tumble of commercial reality for traits to surface, no matter how well you think you know them.
Research shows start-ups with co-founders are four times likely to be successful than those going solo – a strong case for forming a double act. Going it alone it’s easier to make decisions quickly and go for it, and generally you can’t fall out with yourself, and you also learn more – by necessity. Alternatively, with a co-founder you have the benefits of ‘two heads are better than one’, improving decision making. With a co-founder, you’re also not spreading yourself too thinly, responsible for everything. Working with complimentary skills and doubled bandwidth, more gets done.
However, co-founder relationships can make or break a business right from the outset. In his research into 10,000 founders for The Founder’s Dilemma, Harvard Professor Noam Wasserman found that 65% of startups fail as a result of conflict among co-founders. So how can you keep that co-founder spark of ingenuity, togetherness and ambition going once you’re on the rollercoaster reality of the startup journey? Here are ten tips to ensure there is a light that never goes out in your co-founder relationship.
1. Start with self-awareness You need to first understand yourself to better understand a co-founder. You have to go inwards first. This is about self-exploration and developing awareness around yourself in the relationship. Spend some time thinking about what makes you tick and what you need from the relationship – personally and for the business – so you can co-create with a person who complements and supports you.
– What’s your idea of a great weekend?
– How do you deal with surprises?
– What do you need more, security or adventure?
Through this self-analysis, you’ll gain insight to share with your co-founder (at the start or at any point in your journey together) and create a common language of understanding and awareness that will help you do the work to thrive together.
2. Make time to connect in different contexts However you’ve connected to a potential co-founder, it’s important to dig beneath initial, surface-level interactions. In Esther Perel’s How to set up a healthy co-founder relationship she urges co-founders to move beyond the coffee meeting and do something together that offers insight into how the other person reacts in different settings and with a variety of people. She suggests ‘Virtual Villages’ – connect with fellow co-founders in a group and hear about their challenges and not simply curated stories on social media. Get the nitty-gritty of other real-life stories.
HubSpot co-founders Dharmesh Shah and Brian Halligan met at MIT, and Dharmesh noted that simulating a co-founder relationship through various projects offered the chance to see each other’s complementary skills and values and that they liked spending time together, something that shouldn’t be underestimated.
3. Get it all out in the open If you’ve connected meaningfully with a potential co-founder and are ready to commit, it’s time to pop the question. Clarifying the big-ticket items – your vision, desired impact, and financial goals, for instance is critical. In any co-founder relationship, there needs to be 100% transparency. If you can’t be honest with each other, then you can’t expect to run a successful company. Both of you need to be on the same page at all times and have enough respect for each other to do so.
4. Create rituals or check-ins to keep communication fresh Setting aside time for vulnerability and human interaction separate from the daily business conversations is essential. A weekly co-founder meeting or regular co-founder retreats can provide opportunities to kick back and connect around something other than work. Try to preserve those moments where you can really come together and maintain that connective spark that brought you together initially.
5. When disagreements arise, hook into to shared values Difficult conversations can create toxic co-founder relationships quickly. The key for resolution is consistently grounding discussions in the values and vision that brought you together in the first place. It’s OK to reframe the relationship when moving forward, if you’re connected with a co-founder who shares your values and goals and you’re implementing key strategies.
The Gottman Institute predicted the likelihood of a married couple getting an early divorce just by observing the couple interact over a period of time. Surprisingly, it isn’t the amount of fighting that matters most, it’s how partners fight. Gottman’s research found that criticism, defensiveness, and stonewalling are most likely to predict divorce in married couples. It turns out the same goes for business partnerships too.
6. Agree on what success looks like Agree on what success looks like for the both of you and ensure you agree on how you’re going to achieve that goal. Conflict happens, and unexpected things happen. That’s why it’s important to remember the end goal.
7. Have the bottle One way I’ve helped co-founders overcome differences is by using a milk bottle. The ‘who’s got the bottle’ technique is that when one person is holding it, it’s a sign they are uncomfortable about something they’re about to say, that maybe contentious and personal. I use this to protect the relationship from damage. It’s a great nonpartisan way to regulate how we seek comprise without being hurtful to a co-founder.
8. Recognise your weaknesses Partners work well together because they complement each other’s weaknesses and strengths, and vice versa. With that said, I think a lot of fall out comes from fear of failure. You have to trust that your partner can deliver as much as you do.
9. Tolerance: know that it’s ok to disagree Go ahead and bump heads. You are smart, confident, and brave – otherwise, you wouldn’t be in this together. Just make sure you both know that it’s OK to disagree and use the tension as the spark for discussion and creativity.
10. Be clear on each of your roles One of the top reasons startups get derailed is because each co-founder was ambiguous about expectations before things began. That’s why it’s necessary to get as detailed as possible.
Like dating, there’s a honeymoon phase with startups too, where you just have faith that things will work themselves out because you’re caught up in the rush of excitement. But the reality is, being in a good co-founder relationship will help deal with the myriad of issues coming down the road.
Be proactive about nurturing and investing in your co-founder relationship as much as you do for your brand, product, and culture. I’ve been through a co-founder break-up. It’s every bit as difficult, painful, and upsetting as a romantic break-up. I remember my frustration at being unable to save it. At the time, I didn’t realise how common this situation is, not that it would have been much relief.
In 1988, the one-car garage behind 367 Addison Avenue in Palo Alto, California, where William Hewlett and David Packard built their first oscilloscope, was officially designated as a California State Historical Landmark. A plaque proclaims the garage as The Birthplace of the Silicon Valley. There’s also a plaque with a joint quote from Hewlett and Packard: Believe in each other. It says it all about co-founders that needs to be said in just four words.