co-founder

What is a good co-founder worth? Assume that you will execute your most ambitious vision for your startup, are you willing to give half of those earnings away? For most of the entrepreneurs, upon extrapolation its a no-brainer yes[0].

With that in mind - who is your co-founder? - Ambitious outlier you found way before the world did.

Understandable[1], but very counter-intuitive - we don't judge our co-founders as such in the initial days of starting up and that reflects in the vetting we do while talking with potential co-founders, the decision of who to co-found with and the way we work with them.

Co-founder choice problem is going to be heard more since more startups are going to be found by people that have not known each other before starting up[2].

Here's my thoughts after observing tense founder relations and analyzing personal failures on the topic.

Core values[3]

Most founders are good at finding the one with complementary skills. They are also very good at identifying polar opposites in values but, as humans, have hard time figuring out and internalizing in-between.

Founders with different core values shouldn't startup together. You won't work with the same enthusiasm as you would and should. And it will end up in divorce at one point or the other.

You want to find an ambitious outlier way before the world did...with same core values as you have.

Actual core values are found three layers below of what people say their core values are. Any core value that can be expressed in a single word, is marketing material/ dictionary content, not a core value. You can't have "honesty" as core value[4].

Throughout your conversations, especially in the initial days, you want to know what they say their core values are, what they actually do and gather past data. And you need to do two things - match your value scales and share your past data/ stories. Most of the core values are very personal and less professional. You want to ask deeply personal questions you are comfortable answering.

Some examples: If your co-founder says that they are a feminist (and probably is) but also has a knack for (and enjoys) cracking good sexist jokes that you don't have an appetite for - you have different core values. If your co-founder is getting angry and displaying it in a way that you are not comfortable with (how much ever warranted it is and however less often it is) - you have different core values.

Simulation

Work together for few days/weeks. That gives most data about each other. You are looking for someone who is smart(er) and puts in efforts at the scale you aspire to be. Best co-founder choice is when you are intrigued by their intelligence and inspired by their efforts. And it comes naturally to them.

Your productivity graph is your data on whether the team works. Even better[5] - get an external party (mentors/friends) to track your productivity graph.

Hockey stick

Confidence on co-founder choice is like hockey stick. Trick is to take just the right time to stay in the slow growth phase before shooting up.

Check if you are fighting the right problems and facing the right failures. If the battles are about internal execution - you have a problem. Battles about external reception will be your day to day execution and is the crux of starting up anyway.

Check if you are able to have tough discussions, sustain failures but also have a good smile about it later.

Not being able to have tough discussions is a strong indicator of mismatch. Most of the startup journey is a uphill cycle climb through luck valley. You will have more harsher times than the easier ones. You want to pick someone with whom you can enjoy even the harsher times.

Another signal to check is if you are able to celebrate the failures. Its easier and comes naturally to celebrate a success. So ignore that data point, especially pseudo successes like fundraising.

And importantly, check if your collective assumed ambition is scarier than individual reach.

You want to find an ambitious outlier way before the world did...with same core values as you have... with whom you can fight the aligned battles.

Radical respect

Co-founder choice is a one-time decision. Co-founder relation is continuous execution. Often, founders are too much involved in day-to-day execution that we forget to give time to nurturing the relationship.

One way to execute on the relationship is to think of them as your boss and your employee. Almost every todo boils down from either of those scenarios.

Talk 2x more about vision than you do now. Day-to-day execution is so much farther from long term vision that founders rarely talk about long term vision with each other. You want to keep dreaming collectively.

Best co-founder relation is when there's radical respect for each other. It comes easier with radical transparency. Radical transparency can be achieved through radical communication.

Some examples: I know founders who had access to each other's email ids so that they can reply to customers immediately even if the other person is asleep. Some founders have special chat clients dedicated only between the co-founders so that both are assured that their messages won't get ignored with other notifications. Some chat and speak with their co-founders more than their partners/spouses. I know founders who didn't have much respect about each other's decisions and they didn't have agreed upon ways to deal harder circumstances. As the team grew, employees noticed and they lost respect on the co-founders relations. It's hard to earn it back.

Your co-founder's assumed ambition is not yet realized ambition. They are going to make tons of mistakes to get there. You want a co-founder relation where it's easier to make mistakes and there's confidence that you can learn from them.

Be okay with making a bad co-founder decision. It takes time to figure out what matters to you. Best making a mistake and iterating than not starting up at all.

Sid

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[0] If it works out, what difference does x$ vs 2x$ make in your earnings. With reasonable probability, x$ is lot above your fuck-you money as much as 2x$ is. And for that difference, you get someone to climb the uphill with. If it doesn't work out, might as well face the hurdle with another person. If your answer is not a yes for this (which I can totally imagine a second or third time founder saying), then the rest of the essay might not make sense.

[1] My thesis for this is that being evolutionarily pessimistic people, its hard for us to imagine ourselves winning as much as we should be. I think whatever every entrepreneur aims for, they should be aiming way more than that to offset innate pessimism. Even the smartest and ambitious entrepreneurs might not give a thumping yes when asked if they are the person who would achieve their most successful self. The difficulty gets amplified when you have to answer the same question for a co-founder since it requires double the confidence. Day-to-day startup execution doesn't help either since significant portion of time is spent on micro level execution at MVP stages. Its easy to invest smaller portions of our time to long term macro vision. And when you are doing anything and everything to make those small pieces fall in place, its understandable that you don't match up yourself to what you should be, because when we think of our most ambitious and successful self, we rarely imagine ourselves doing what we do today.

[2] Constraint that founders should know each other before starting up produces limited set of startups. People investors/ accelerators like EF are entering the ecosystem to bring smart individuals together with the aim to startup. It's win-win scenario for founders and market. Deepti, my co-founder @Adaface, and I met at Entrepreneur First, Singapore batch for the first time and we ended up starting up Adaface five months later.

[3] Naval has a good piece on this with better words and crisper sentences. https://nav.al/intelligence-energy-integrity

[4] Ask anyone you know if they are honest - almost everyone will agree. But we know that can't be true. I don't think most people are willingly dishonest either. I think the scales of honesty are different and we assume that everyone else works with our levels of honesty. (we can replace honesty here with any value word)

[5] It's very easy to think that you are being productive just because you are putting in the efforts. External party asking the right questions and judging would be a better sounding board to see if you as a team are actually being productive. One of my favorite ways to think about this - your friends always see your breakup way before you do.