Ask any startup founder or experienced VC and they will tell you that the most important factor impacting success of a startup is the founding team. So, if you are the proud CEO and founder of a startup, how do you decide if you need a co-founder? Whether hiring a co-founder or other senior leadership, how do you determine the “right fit”?
Do you need a co-founder?
I would argue that the answer to that question in most situations is a resounding yes.
For many reasons!
First and foremost, launching a startup is not for the faint of heart. It of course takes a great idea, but it equally demands fortitude and determination to navigate the bad times that inevitably come. It also requires convincing all types of people and getting them to invest in your idea literally and figuratively: friends, family, angels, VCs, potential employees, and customers.
A co-founder can help with all of the above. They can be your anchor when you find the startup ship turbulent, as well as another voice to convince all that need convincing of the greatness of your idea. Finally, the most obvious reason to get a co-founder on board is for the critical skills they bring to the table. No one person can do it all at a high level, but co-founders can fill in the gaps.
I was fortunate that my life partner also became my co-founder and I can state without a doubt that the success of my company would have been limited without her contributions.
The Secret Sauce
As my company grew, I had to hire key execs to run large parts of the business. I made mistakes in some of those hires which had counterproductive outcomes. Over a period of time, here is what I learned to look for:
Firstly: Emphasize technical skills. I was hiring these execs for a specific position such as the global head of human resources, head of operations or head of a particular country we had just entered. This is very similar to hiring a co-founder for a startup. I needed to make sure that the hire had the requisite skill set (e.g. CPA to be the Controller etc). Ask yourself what you need from additional leadership and hire for that skillset: no compromises!
Secondly: Have they been there and done that? I was usually hiring for a specific stage of growth for the company. A COO can be a whiz at running a company when it is between $5M and $10M of annual revenue but can flounder and fail spectacularly when the company grows to $50M. A hire should be made with a specific growth target in mind (e.g. $10M to $100M in ARR; grow from US based to a presence in Europe). While there are no guarantees for the success of senior hires, taking another company through the same trajectory can go a long way.
Lastly: Prioritize cultural fit. Cultural fit trumps all other criteria! Communication, work ethic, and how your new leadership choice manages up and down the organization can be the difference between great success for the firm or massive disruption which could even be fatal. Founders can be intoxicated by the awesome LinkedIn profile and past successes of a key hire and be blind to the obvious flaws that are easily detected during the interview and background check process.
Overall, getting an effective co-founder into a company will catapult it to new height,. without question! As incontrovertible is the fact that getting the right person on board can be a life or death decision. Good luck!