This post is part of the Bootstrapped Startup 50 series. The goal for the BS50 series is to cover everything that matters when bootstrapping a new startup. The posts are sequential, so it wouldn’t hurt to read from the beginning if you’re just joining in. 

In the last installment of the BS50 we talked about why having a cofounder could be a good idea. This time we’re going to take the alternate side and point out a few things that could be detrimental to your startup.

Personality Conflicts

Startups and small companies truly are like families. Everyone has to spend a great deal of time around each other and everyone has to rely on each other for success. There are no inconsequential team members when a team has only 2 or even 5 employees. Everyone has to work well together or the quality of product shipped will suffer. Personal conflicts between team members can upset the delicate balance in small teams.

This risk is heightened significantly when you’re considering a cofounder. A cofounder is going to bear a significant portion of the decision making responsibility, so trust and understanding are absolute requirements. To be successful you’re going to have to implicitly trust your cofounder, letting them handle their area of expertise without your input. If you don’t get along with your cofounder then the startup will necessarily feel that discord.

Financial Considerations

A cofounder, depending on your specific stock and financial agreements, will necessitate a large portion of income generated. This is somewhat less important if the company gets off the ground quickly and starts earning enough revenue to cover expenses. But what happens if the fledgling company struggles along for a year or so and there isn’t enough revenue coming in to pay either cofounder enough to keep them around?

Long-Term Stability

The long-term goals of your cofounder should matter when making decisions. Are they in the company for the long-term or are they just going to dabble in your startup for 2 years? A committed, long-term cofounder is significantly more valuable to your company than someone who’s just looking to help you out for a while or wanting to get out of their current job.

Your Take

What are your thoughts on bringing in cofounders? Have you had any experiences with a cofounder before? Please share in the comments.

Next up we’ll talk about the potential pitfalls of adding cofounders.

This post is part of the Bootstrapped Startup 50 series. The goal for the BS50 series is to cover everything that matters when bootstrapping a new startup. The posts are sequential, so it wouldn’t hurt to read from the beginning if you’re just joining in. 

The decision whether or not to have a cofounder for your new venture is one of the most critical that you’ll make. It will affect everything from how the company is operated to how much money you personally make once you’ve built a successful business. There are many things to consider, and it’s not a decision that should be taken lightly.

I’m going to split this discussion into two parts because it may get a little lengthy. In this post I’ll hit on the advantages of bringing a cofounder in.

Cofounders Vs Employees

First, a quick note about when you should choose a cofounder instead of an employee. Early on you’re most likely not going to have any revenue, so hiring an employee immediately creates an expense that has to be paid. If you’re considering hiring someone who is extremely talented and that you trust implicitly then you should consider making them a cofounder (co-owner of the company) instead. If they’re passionate enough about your idea then they may forego some salary now for ownership considerations and deferred income a little further down the line. Cofounders are inherently more invested in the company’s success.

Complementing Your Skillset

Bringing in a cofounder whose skills complement yours, not mimics them, is a great way to round out your newly formed organization… they can be the yin to your yang. If your startup is a web company and you’re a designer then you’ll probably need to bring in a developer. Bizdev types will probably need someone technical, depending on the industry. Having founders with a combined skillset that covers the majority of the work needed to get a company off the ground is a luxury and probably gives you a better chance at success than going it alone or having to rely on contractors and new-hire employees.

Cofounders Are A Force Multiplier

The initial work required to get your product to an MVP state or an early alpha stage is daunting. Being able to split that workload will help you get your product out the door sooner and let you start the even longer process of building a profitable product earlier. This force multiplier allows you to more aggressively tackle opportunities and challenges, go after bigger clients, think bigger, etc.

Your Take

What are your thoughts on bringing in cofounders? Have you had any experiences with a cofounder before? Please share in the comments.

Next up we’ll talk about the potential pitfalls of adding cofounders.