Tricks to improve the way you interact with your co-founders and improve your performance
The importance of co-founder relationships
The relationship between co-founders can be the most emotionally intimate and intense one that many startup founders face to date. It makes sense, considering that co-founders spend the better part of their lives together in the early stages, are drawn together by a common cause, and are heavily emotionally invested. Some people even argue that finding a co-founder is like dating for a marriage. From a relationship perspective, this is very much true. Many functions in a co-founder relationship resemble the functions in a romantic relationship. Such is the need for support, the reliance in parts on the other party, the need to be seen and many others. Unlike a marriage, co-founders have to talk to each other almost daily. It can be harder to leave a co-founder relationship than to leave a marriage – emotionally and legally.
Many founders complain that their romantic partners do not sufficiently understand and relate to their problems professionally and emotionally. This notion is not an impression but a fact, as it is next to impossible for an employee to understand the struggles of a freelancer, entrepreneur, or founder. Thus, the co-founder serves as the emotional pillar of support. They are also dependent on the well-being of the co-founder even more than the romantic partner. Finally, in the early stages of a company, the feelings towards the co-founder are stronger than towards the romantic partner. Thus, we see that the co-founder serves a dominant function in the balancing and mental well-being of the other co-founders. While the first step for all co-founders is awareness of this fact, here we want to provide some tips on how to regard a co-founder relationship and potentially improve it.
The rules of compatibility and compassion
When looking for a partner in crime, many co-founders look intuitively for a mix of compatibility and compassion without knowing the implications or importance of these dimensions. An ideal co-founder needs to rank well on both dimensions. At the same time, an overshoot on either can create problems when not appropriately addressed. Let’s take a look.
Compatibility is about the hard factors. In romantic relationships, compatibility is only about the same set of values if two people complete each other and if they can support each other. In a professional setting, though, it can become more complicated as we also need to consider hard skills. Excellent compatibility is to have one co-founder being great at creating products, another at talking to customers, and a third at creating organisations. Note, however, that these do not need to be the dimensions for compatibility. Also, three techies can make a highly compatible team if they add to one another on other dimensions. Compatibility is also a shared vocabulary from a similar professional background and all the things that make it a good match on paper. The sweet spot for compatibility balances similarity and differences so a team covers as much ground as possible but is still similar enough to make communication on a factual basis easy.
Compassion is the temperamental side of the equation. In romantic relationships, compassion consists of sexual tension and passion. While sexual tension is unnecessary and almost always a hindrance to professional relationships, how much a co-founder “burns” for a part of the enterprise remains. This can be the market, the product, the organisation or anything else. Of course, too much compassion will result in arguments and hurt egos. Thus, the sweet spot for compassion is a level where arguments occur out of passion but are still resolved on a factual basis.
Simplified, there are four matchups for co-founder teams.
The low compatibility and low compassion teams seldom occur and are primarily designed in consortiums. They quickly lose focus and interest in the endeavour and break away silently.
The low compatibility and high compassion teams always argue about everything but don’t get very far, as there is no common ground for work. The drive they build up is ground down in personal infighting and coups.
The high compatibility, low compassion teams can execute strongly and make progress early on. If the compassion does not evolve quickly, these teams lack the creativity and foresight of where to move the organisation and lose themselves in doing meaningless work that appears like a stand-still.
Finally, the high compatibility and compassion teams are the engines behind highly effective companies. While they generate a lot of heat and friction, it translates to the creative energy that propels the company forward at a fantastic speed if managed well.
Needs, values, and believes
Aside from the fundamental understanding of compatibility and compassion, co-founders must know their needs, values and beliefs. These factors will determine their success, talking to each other, and effectiveness in working together.
Needs are the factors every human needs to fulfil to feel complete. Needs can be anything but often related to security, appreciation, growth, and others. For example, a co-founder could need to earn enough money to save for retirement as part of their security needs. While many investors might advise you only to pay yourselves just enough to survive, and a successful startup is an upside, this neglects a fundamental law of human nature for this individual. It is ok to have needs that society doesn’t associate with the renegade entrepreneur. The need for a pat on the back is just as usual for the founder as for anyone else. Being aware of these needs is essential to be able to work effectively. Like in a romantic relationship, there will need that a co-founder will be able to provide for, while there will be other needs that get fulfilment somewhere else. When the co-founder team works against the needs of one or more founders, the team will not be able to perform in the long run.
Values and beliefs are usually one layer deeper than most people assume. While a shared faith or political belief might be helpful, these values should not be aligned. We are looking for the convictions of what a founder expects from life and why. What is the core understanding of the human condition, what is the goal of life and what contribution to society is most crucial. If one founder wants to create a moon shot and try to go for a unicorn, and another wants to make a small team of people he loves working with, there is a mismatch in beliefs. It is not possible to reach both goals at the same time. While many things are negotiable, values and judges are usually not passable on a deep level. Even if one founder agrees to a common set of values, if they feel differently about it, acting accordingly in times of stress will be hard to impossible.
Convergent and divergent relationships
Those two ideas brought us to the most crucial consideration in a co-founder team. Is the relationship convergent or divergent? Startup life is very stressful; external events will shock every relationship and throw them out of equilibrium. Even the best relationships will suffer and be neglected temporarily by necessity. A divergent relationship sits on an inverted-U shape. Once, it is off its equilibrium, it continues rushing downwards, requiring considerate action to return it to the equilibrium. That means that co-founders will drift apart over time, and the relationship will worsen without work. The problem with these kinds of relationships is that the co-founder team itself is another piece of work that draws energy and tends to break when this work is not put in.
In a convergent relationship, the relationship sits in a U-shape. When pushed off the equilibrium, the relationship returns to equilibrium over time. This means that the everyday interactions bring the co-founders together. Despite the stress pushing them apart, the trend goes towards them. The laboratory experiment for these relationships is to set a team under pressure to disturb the equilibrium and then let them return to their everyday tasks – not a retreat; everyone is chill at a retreat, their day-to-day tasks. Will the team move closer together without the stress and any further action, or will the alienation continue even without the stressful events. While this is also a question of character, a founder team should find itself in the position of moving towards equilibrium.
Where do the claims come from
We conducted quantitative studies among German entrepreneurs to measure the effect strengths we claim in this article. For the qualitative claims, we ran multiple case studies also among German entrepreneurs and drew from our experience. Please note that many claims are statistical, and while they may hold true for the majority, they might not apply to the single reader. Each relationship is unique and should be treated as such.
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