Deciding whether to take on a partner is one of the toughest choices a founder can make. Having recently gone through the process, I thought I’d share some tips (Note: I’ll get to how to find the right partner in an upcoming post):
1. Two beats one. Many founders choose to go it alone, at least at first (see below). Then again, adding a partner to your startup has many benefits. Two partners have more contacts, which can lead to more investors, employees, and customers. Likewise, two partners may have more cash, or at least more credit. Two founders working for free can get more work done, faster, with less cash outlay for employees or vendors. Lastly, don’t discount the softer side of partnerships. Startups are emotional roller-coasters, and having a partner can smooth out the loopdy-loops.
2. Consider a warm-up. Startups rarely find success with their initial strategies. More often, they switch to a “plan b” along the way. That means the ideal partner today may be dead-wood tomorrow. I’ve found it helpful to go solo for a few months. That gives me a bit of time to get feedback on my idea, tweak my strategy and approach, and then zero-in on what I really need from a partner.
3. Take stock. What are the major tasks that will be required to operate the business once it’s up and running (Note: Don’t make the mistake of choosing a partner to help with work you’ll only need to get started)? Are there logical groupings of those tasks, like one person selling and another executing? While two person teams tend to be easier to manage than three, you might find that there are three logical groupings of tasks, such as with an ad-supported website (One person gets people to the site, another generates content, and a third sells access to marketers).
4. Mind the gaps. Which of the logical task groupings are you best-suited to oversee? Once you carve those out, what gaps are left?
5. Profile your co-founders. The most common partnership mistake I see is when people choose their friends or relatives as partners, just because they are available. That leads to mismatches in skills/roles, goals, motivations, etc. Instead, follow the process above, and use it to develop a profile of your ideal founder, the way you would develop a job specification. Then go out and find the right person for the role.
Got tips of your own for founders deciding whether to take on partners? Please share.