After five years coaching founders across four continents, I’ve seen my fair share of terrible matches. In the last 10 days alone, I’ve had two new clients showing signs of clinical depression, as a result of cofounder disputes.
Cofounder dysfunction is one of the most common issues I see in startups. It’s likely an offshoot of the “move fast and break things” ethos of acting now and thinking later. Business and funding models emphasise product-market fit, while glossing over team dynamics. Relying solely on product data to predict performance — irrespective of compatibility and team cohesion — is risky. Building your own business is highly personal and affects you in ways you may not realise. Taking a moment to choose the right partner is key to both performance and wellness.
Dysfunction often manifests as inequality. I recently spoke with a two male and one female team — alumni of prestigious US accelerator YCombinator — who started out with great rapport, complementarity of skill sets and alignment of goals, but no communication or transparency around power and workload. One founder functioned as a sort of dictator, with the two others towing the line. The first years went by in a blur of hard work, but the inequality wasn’t sustainable. One founder withdrew and the female founder realised she had been doing more work for years, despite having a lesser proportion of equity. She felt this was a gendered expectation and that she had no recourse to negotiate, given the team’s power dynamics. By the time we spoke, she felt dismissed, exploited and trapped. Cutting her productivity would hurt the company, but leaving wasn’t an option after investing years into a successful company.
“I think we’ll see that team dynamics are actually more important in startups than traditional workplaces.”
It’s not just a gender issue though. The typical founder is independent, confident and driven, with a clear vision. Compromise and teamwork may not come naturally, resulting in lots of conflict and power struggles. We’re in the nascent days of founder research, but I think we’ll see that team dynamics are actually more important in startups than traditional workplaces.
Startups are resource poor, leaving founders far more vulnerable than most executives and workers, who are normally surrounded by support staff and protected by labour regulations. Workplaces are required by law to have protective policies and structures in place for managing hours, vacation time and roles. Most also offer formal support through wellness and other HR programmes that offer team building, mentoring, coaching or training and informal support through the familiarity and predictability of coworker relationships.
“The agility and freedom of unregulated environments comes at a high psychological price.”
In reality, the agility and freedom of unregulated environments comes at a high psychological price. There is very little to lean on for support or certainty. Startups rarely have a stable operating budget, workplace or even product offering. All the excitement and dynamism actually creates constant change, chronic risk and pervasive feelings of insecurity and instability.
That’s tough to manage. Human beings need to be able to manage uncertainty in order to feel secure. We all need the sense of safety that comes from predictability — whether in relationships, routines, finances, health or environment. In the early days of startups, many founders gamble with all of these. And they often do it alone, because there are very few consistent relationships. Founders rarely have coworkers to share a regular coffee and chat or to watch out for signs of distress, leaving them to rely on themselves and their cofounders for essentially everything. Without the trust and support of a strong cofounding team, founders and companies can be in serious trouble. Even the best product only goes so far without a good team.
Like choosing a good life partner, choosing a good cofounder stands to impact almost every aspect of your life. But, how do you do it? It’s always going to be a risk, because there are so many unknowns, but there are some things to look out for. The golden rule is to know yourself. Know your strengths, weaknesses, expectations and needs. Are you an optimist or overachiever? You may need someone more critical to pull the brake. Do you struggle with decision making? Look for someone to push you or to execute. The key is balance and complementarity of strengths and weaknesses.
If you’d like to learn more about your own values while helping our research, here is a quick survey that can help you identify what to look for in a great cofounder match.
Have you experienced a tricky cofounder relationship? We’d love to hear about it — on or off the record. Email [email protected]