The secret to a powerful co-founder partnership
Co-founder partnerships are a critical building block of any successful business. Get it right, and your company will grow on a solid foundation. Get it wrong and it could lead to a painful end.
I had an idea for a place-based, leisure industry business and I needed someone who could compliment my skills and experience to bring my idea to life.
I brought an in-depth understanding of the entertainment industry and international business development expertise, and I needed someone who understood real estate and the local business environment for our target market.
I knew the perfect guy. My friend – I’ll call him ‘Sam’ – had a sharp entrepreneurial mind and decades of experience developing real estate. We had known each other for twenty-five years, and while we weren’t best friends, we knew each other well enough to be able to trust one another.
I approached Sam about my idea. He immediately got excited about it, and we became 50/50 partners. On paper, it looked like a perfect match. In reality, it turned out to be a complete disaster!
The foundation for a strong partnership is shared commitment
Sam and I shared the same vision for the business. We both wanted to build something truly unique and grand, a concept that would create a new standard for location-based entertainment in our market.
It soon became clear that while we were both enthusiastic, Sam and I didn’t share the same level of commitment or work ethic to bringing our business to life.
While he loved to speak for hours about the big picture, I was into getting things done. While he was thinking that it may be a good idea to follow up on a lead, I had already contacted five people and set up three meetings. When the time came to update each other on what we had accomplished the previous week, I came with a list of my Top 10 items, and he came with excuses about why he hadn’t had time to follow up on the single item on his list.
As our idea became more difficult to implement than we expected – a standard experience for creating any business worth building – I became more committed to pushing through the problems to find a solution. Sam, on the other hand, seemed less willing to go the extra mile.
I also became aware that many of the complimentary skills and contacts I had imagined that Sam would bring to the partnership really didn’t materialize when it came time to deliver.
I communicated my frustration about the state of our partnership to Sam several times over the course of our 18 months of working together. We even renegotiated our stakes in our venture to better reflect our respective contributions, but it didn’t’ make much of a difference.
After a while, Sam became less and less motivated and I just continued without his active involvement. Eventually, we dissolved our partnership. The business idea ended up languishing, not really progressing beyond a well-developed concept.
A co-founder relationship is like a marriage without the sex
I’ve learned that launching a business with a co-founder is like entering into a marriage. If you don’t share the same fundamental values and approach, your partnership is doomed to end in divorce.
Here are some keys questions I wish I would have asked myself before saying ‘I do’:
• Does my co-founder have the same level of commitment to our business as I do?
• Does my co-founder have a similar work ethic as I do?
• Does my co-founder bring real complimentary skills and experiences to the partnership?
• Does my co-founder exhibit a willingness to work through problems to arrive at win-win solutions?
• Do I trust my co-founder to put the interests of our shared business ahead of his own personal interests?
I you answered ‘yes’ to all these questions then the likelihood is you will have a productive business partnership.
If you are unsure about your answer to any of these questions, it’s important you sit down with your future or existing co-founder and discuss how you can’t work through these concerns.
Your co-founder should NOT be your clone
Having a co-founder partnership doesn’t mean you should expect to see everything in the exact same way, or that you must agree on everything you do. After all, having someone who brings a different set of life experiences and a new perspective to key decisions is critical for shared success.
In my partnership with Sam, we had multiple spirited arguments about how we should approach a problem and I found these ultimately led to the best possible solution.
You need to ensure, however, that these discussions are built on a foundation of shared trust and a shared commitment to the business, and that you are both prepared to arrive at a win-win solution when your points of view don’t match.
Move on from a bad partnership before it’s too late
The good news is that I learned from my experience with Sam.
I discovered that even when you approach a co-founder partnership with the best of intentions, there are certain differences that you simply can’t overcome. If you accept a compromise on critical areas like values, ethics, or work ethic, it will most likely come back to haunt you.
More recently, I was faced the opportunity to buy into an existing business where I would become a significant shareholder and a member of the management team. The chance to join a high-potential business and become part of young team was promising, and so I approached the opportunity with an open mind and a willingness to compromise on a range of organizational and financial elements of the deal in the interest of getting it done.
As we approached the final stages of the negotiation, I began noticing certain qualities in my future partners that didn’t sit right with me. It seems we didn’t share the same values when it came to leadership style and decision-making. As I approached each subsequent meeting, an uneasy feeling began growing in my stomach.
Thanks to my experience with Sam, I challenged myself to answer the questions I listed earlier honestly, and it became apparent to me that this was just not going to work.
We decided to end the partnership discussions. It was a difficult decision to make at the time, but in retrospect I am 100 percent certain that it was the right one — one that ended up saving both myself and my future potential partner a lot of unnecessary grief and future conflict.
Building a powerful co-founder partnership requires a high level of commitment and is critical piece of building a successful business. Make sure you do your homework before entering such a partnership and don’t be afraid to walk away when it just doesn’t feel right.