Recently I talked to Stanford’s Center for Entrepreneurial Studies (CES) about our team formation tools and how they could potentially help up-and-coming entrepreneurs and students taking classes like Startup Garage, Lean Launchpad and scores of other entrepreneurial courses across Stanford, as well as summer courses in innovation and entrepreneurship, to improve how they get matched into teams that are functional and don’t break up if they are set on building something big.
The key question to answer here is: how do you establish a cofounder relationship and your early founding team in what is essentially a vacuum? Hope the below helps 😊
How to find a cofounder for your startup?
Starting a business is not a one-person job, and finding the right cofounder is one of the most important decisions you’ll make in the life of your startup. Choosing the right cofounder for your startup is critical to its success. Start early, avoid picking someone random are the most obvious facts that’ll help guide you. Finding the right co-founder isn’t easy – according to Startup School, 20% of active founders are seeking a co-founder, while 25% of aspiring founders cite not having a co-founder as a blocker to starting their company full-time. Many have tried multiple avenues for a long time, with little success.
Leverage your personal network
Start by looking at your network and people you know. That’s the best place to start. Finding a cofounder – if you’re serious and determined to start a company – resembles establishing a marriage or long-term relationship more than anything else. And the negative stuff that comes about in relationships too. It’s not a date. If you get it wrong you’re in for potentially big trouble after having established the company legally, plus you might’ve wasted time and opportunity cost. A cofounder should bring complementary skills, share the workload, and offer emotional support. However, choosing the wrong cofounder can lead to failure, and stats show this.
Avoid a random cofounder
Picking a random cofounder is one of the worst things you can do. Avoid the temptation to partner with someone just because they want to start a business too. Choosing someone you don’t know well, or someone you don’t have a long history with, is more risky.
You want to be sure that you can work together and have a past history to bind you together. Take advantage of school or work opportunities to get to know potential cofounders. In addition to being smart, you want a tough and/or calm cofounder who can complement your skills.
Meet via university or work
If you’re in college, this is the best time to meet potential cofounders. You’ll meet people with similar interests, and you’ll have the opportunity to get to know them over a few years. If you’re not in college, consider people from work. At good tech companies you’ll be exposed to smart and driven people who could become potential cofounders. Look beyond at clubs/organizations you’re a part of naturally, and your personal network above all.
Relentlessly resourceful cofounders are ideal
Sam Altman from Open AI / Y Combinator noted that at YC they look for cofounders who are relentlessly resourceful and unflappable. Such individuals are like “James Bond” in that they know what to do in every situation, act quickly, are decisive, creative, and ready for anything.
Location matters less now
When choosing a co-founder, many people assume it’s important to find someone nearby to meet up in person. However, remote work has changed this mindset. Location is no longer key.
What we’ve noticed ourselves though, is that in the early stages you do want to work together as much as possible, whether in one place (home, garage, office) or one means (async or streamed remote work) to be aligned. Remote work is great for flexibility and access to talent and opportunity (extremely!) and for a better work-life balance. However, it not ideal for collaborative and creative team work – it’s harder to do that way, which doesn’t mean it’s impossible, but you have to be intentional and smart about it and plan for it. It takes more of an effort.
Two, three, or max. four cofounders
Two or three cofounders are about perfect – data shows. One sucks (it sucks to go at it alone, plus chances of “unicorn” success are miniscule data shows), five is bad. Two or three cofounders, or four, allow for a balance of skills and support necessary for startup success. At YC only 4 out of the top 100 companies funded by the organization were started by solo founders.
YC cofounder match
The most well-known tool and platform for cofounder matching is the Y Combinator cofounder matching platform. Y Combinator’s founder match rests on a large, global community of founders, entrepreneurs and techies. YC’s founder matching platform is now available for everyone through Startup School, the best free online program and community for founders that we’ve gone through ourselves (and we highly recommend it!).
If you’re actively looking for a cofounder sign up via ycombinator.com/cofounder-matching – it’s like online dating for cofounders, helping you find the right match based on your preferences and interests. You tell YC about yourself and what you’re looking for in a co-founder, then you get profiles of candidates who best match your ideal cofounder, you can send them a message, and if they accept, a match is made. That’s just the intro. Then, you have to meet and work together on a time-boxed trial project with clear expectations and goals to vet co-founder compatibility. Sounds cool! Since launch, 16,000+ cofounder profiles have been created, 130,000 matching invites were sent, with a 25% acceptance rate resulting in 33,000 matches.
Figuring out Cofounder fit
Starting a business is not a one-person job, and finding the right cofounder is one of the most important decisions you’ll make in the life of your startup. Choosing the right cofounder for your startup is key. And the success of your startup largely depends on the strength of your cofounder relationship, the ability to handle pressure, persevere and deliver together in a creative way – because you’ll face a ton of challenges!
What are their goals and values for starting a company?
It’s important to have a conversation with potential co-founders about their motivations for starting a company, and their values in life overall. This will help you avoid conflicting goals and ensure that you’re aligned around high-level stuff. You want to make sure that your cofounder shares your vision for the company and is willing to take the same level of risk as you are. Is the motivation for starting the company basically focused on independent work and running something, not reporting to someone above like in a corporation, love for the problem, passion for the customer, eagerness to make money, or passion or hate for the problem you’re tackling? All this matters.
Shared interests and values matter a lot
Shared interests and values are key. For example, interest in sectors, such as B2B/enterprise, consumer, AI, fintech, e-commerce, future of work. For more on this, review our article on cofounder fit, relationship and alignment – we believe it’s a topic that must be addressed at length and there are powerful tools that can help all cofounders out there.
What complementary skills do you have?
Your cofounder should have a complementary set of skills to yours, so you can divide and conquer to get a lot done. However, don’t fixate too much on finding someone with the perfect set of skills. More important than anything is working with someone you like and trust. If they don’t have the exact skillset you’re looking for, you can always hire people later on to fill the gaps.
In general, founders highly value five skills: product, design, engineering, sales and marketing, and operations. On YC’s matching platform, engineering is in the highest demand, with 63% of founders seeking an engineering co-founder, then it is product (42%), design (39%), sales and marketing (37%), and operations (28%).
Are they willing to learn?
Your cofounder should be very curious and eager to learn new things and take on tasks that may not be great or fun (eg. taking out the trash, payroll and admin, legal, data entry etc.). Startups are often just a grind of doing a lot of boring work to get things going. So, as long as your cofounder is okay with that, don’t rule them out just because they don’t have the perfect set of skills.
How do they handle pressure?
How people handle pressure and stress matters a lot for you and your company. Startups are incredibly stressful and intense experiences, and a great cofounder should be able to support you through those tough times, and persevere. Look for someone who is tough, decisive, and creative. Ideally, you want someone you’ve known for a while, someone you’ve worked with under stressful conditions or a close friend who you know will stick around when things get tough.
Cofounder fit development tools
We hope this helps you. We’ve developed a separate guide dedicated to cofounder relationship development and alignment, including tools that can help you achieve it. You can also find a set of tools precisely for this on Gyfted’s platform.
We’re a bunch of psychologists, psychometricians, behavioral scientists, founders and engineers, including cofounders who’ve gone through conflict, so we believe we have developed tools that will help you out in your cofounder journey!