6 Common Pitfalls When Choosing a Co-Founder

To successfully launch and manage a startup, it's crucial to focus on every aspect of the business, resulting in numerous significant decisions being made daily.

What do you think is the most important decision you can make as a founder?

Your answers may range from developing a great product, getting in front of the right customers, or something along the lines of finding a growing market …

… While all these factors are crucial and vary across industries, one decision transcends all sectors and is often overlooked (though you've likely guessed it from the email title).

It’s finding the right co-founder.

"But why do I need a co-founder? I can develop the product myself, or outsource the tasks to the first employees."

The issue with being a solo founder is the disparity in effort. You alone have significant skin in the game. Your employees might have some equity, but it's often so minimal that they lack true commitment to your company’s success.

Having a co-founder (ideally a 50/50 partnership) ensures that someone else is equally invested. This dynamic provides benefits, such as balancing workload during challenging times (e.g., if you can only contribute 20% one month, your co-founder can step up with 80%) and bringing additional skillsets to tackle problems.

However, it is still better to be a solo founder than having a wrong co-founder. According to Harvard Business Review, 65% of startups fail due to cofounder conflicts.

How can you avoid this path to failure? What red flags should you look for when choosing a co-founder? How can you mitigate the risk of jeopardizing your startup with this critical decision?

Here are 6 common mistakes founders make when choosing a co-founder:

Mistake 1: Overvaluing complementary skillsets

You’ve likely heard about the technical/non-technical divide, or the CEO-type versus CTO-type distinction of founders.

A CEO-type is typically someone confident in working with people, an excellent communicator, and a strong leader - think Richard Branson, Ben Francis, or even Elon Musk (who arguably fits both profiles, which is extraordinary).

A CTO-type, on the other hand, is someone highly technical, capable of building an entire product from scratch, and adept at navigating the ever-evolving landscape of modern technologies - think Zuck or Jack Dorsey.

After this overview, you should have a good sense of which type you are.

If you're a CTO-type, you might think you have an advantage since you can build the product yourself. However, this can be a double-edged sword. While you can develop the product, there’s a high likelihood it won’t gain traction or users won’t engage with it. Simply having a functioning product isn’t enough to create a successful startup.

If you’re a CEO-type, you face a different challenge. You can influence people, sell the product, market it effectively, and lead a development team - yet, you don’t have any developers. You need someone to develop the product in the first place.

So, you might think, “I’m a CEO-type, I’ll just find a technical co-founder to complement my skills at any cost.” Not quite. Overemphasising complementary skillsets is a hidden trap. Startups require constant learning, daily adjustments, and relentless progress. It’s often more beneficial to evaluate a potential co-founder based on their ambition, adaptability, and ability to absorb new knowledge and navigate unknowns swiftly.

While complementary skillsets can provide an edge in certain situations, it’s generally more advantageous to invest in qualities such as ambition, adaptability, and a relentless drive to learn and improve at all cost.

Mistake 2: Not discussing future ambitions

When evaluating a potential co-founder, it’s easy to focus on the present fit and overlook discussions about future ambitions. However, this oversight can lead to significant conflicts down the line.

While you and your potential co-founder may align perfectly now, divergent ambitions can cause problems later. For instance, if both of you aspire to work closely with stakeholders and ultimately become CEO, this overlap can create tension. A company can’t have two CEOs (except in rare, often problematic cases like in the TV show Succession, where Kendall and Roman attempted co-leadership, which worked disastrously).

Failing to address future goals can lead to a misalignment that undermines your startup’s stability and growth. It’s crucial to ensure that your long-term visions complement rather than clash with each other.

Always map out a long-term vision for your startup — 1, 3, 5, and 10 years down the line. Discuss where you both see yourselves within this framework. If your ambitions align and there’s room for both of you to grow, that’s fantastic.

If there’s an unavoidable clash, it’s better to identify it early and reconsider the partnership. This proactive approach can save you from future conflicts and ensure a more harmonious and productive collaboration.

Mistake 3: Hierarchy for quick decisions

In the early stages of a startup, it's common for co-founders to split shares 50/50, which can be great for motivation and equity. However, this equal split can also lead to decision-making gridlock.

Imagine this scenario: As the CEO, you have a vision for a certain direction, but your co-founder, the CTO, strongly disagrees. Without a clear decision-making hierarchy, resolving such disagreements can …