Are two heads better than one when it comes to starting and growing a business? Read our guide to why a co-founder could be the right option for you and how to find the perfect person.
Many businesses have achieved great things with just one founder, and having more than one person leading a company is by no means vital. However, starting a business with someone else can bring you many advantages.
Reasons for Having a Co-Founder
Complement your Skills
You can’t be expected to be an expert in everything, so finding a co-founder who complements your skillset can bring many benefits to your start-up. In the early stage of building a business, it is expensive to employ staff, so having a fellow founder who can take on the areas in which you don’t excel might also be a cheaper solution.
Look for someone who can do what you can’t or enjoys doing what you don’t. For example, if you have good technical skills but lack marketing experience, find a marketer who knows how to promote your product or service. Different personality traits are something to consider too. If you’re an introvert, you might find benefits in working with an extrovert.
There are many famous examples of co-founders with complementary skills who have achieved huge success. They include Steve Jobs and Steve Wozniak, who set up Apple in 1976. Jobs was the visionary with the ideas for creating groundbreaking products, while Wozniak was the practical engineer who could make that vision a reality. It worked out pretty well!
Shared Responsibilities
Running a business is very time consuming and you need to wear many hats. It is hard to find time to handle all the issues involved in running a start-up, so having a co-founder means you can share responsibilities and relieve any stress.
Mat Hunter and Paul Rostas are the co-CEOs of Plus X Innovation and they share responsibilities at the business. Mat looks after day-to-day operations, while Paul concentrates on driving growth.
Emotional and Mental Support
Growing a business can be tough and lonely, so having someone on hand who understands what you’re going through when the inevitable setbacks occur is very valuable.
A co-founder who has made the same commitments towards building the business as you is much more likely to appreciate your concerns and problems than your family or friends.
Attract Investors
If you are looking for investment, you might have more luck getting it if you have a co-founder. Research by SeedLegals found that businesses with two founders are 12% more successful at closing a funding round within 90 days, and more likely to reach their finance target than a one person led business.
Investors tend to be more attracted to companies run by at least two people with complementary skills as it suggests a better chance of success and a bigger return on their investment.
An example is the Techstars investment and accelerator programme, which says that being a single founder “makes things more difficult” when submitting an application.
“We strongly advise you to seek co-founders who balance your skillset,” the Techstars website explains. “For example, if you're a strong developer, you might consider adding someone with business and/or marketing experience. If you're a great business evangelist with no developer, it's very unlikely we'll accept you into the program.”
Improved Decision Making
A co-founder helps you make better strategic decisions. They can be a sounding board for your thoughts and provide feedback.
You can brainstorm ideas together and although you should ultimately reach an agreement on the long-term vision for the business, it is beneficial to have someone who challenges your perspectives and offers a different point of view.
If a problem occurs, you might be too close to a situation to make the right decision, so a co-founder can provide an unbiased opinion. In addition, if a new business opportunity arises, they can help you formulate a plan to make the most of it.
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Why Having a Co-Founder Might Not be a Good Idea
Working with a co-founder brings many positives, but there can be some disadvantages.
Having differing opinions is a good thing but if your views are so opposed that you can’t make decisions, it will not be good for your business. It can lead to tensions which trickle down to your employees and affect company morale and productivity.
In the early days of running a business, money is tight. Having a co-founder means you need to share the profits, which can cause problems.
Co-founders can sometimes clash on style and commitment. You might think you are working harder or longer hours which leads to feelings of resentment. This is one of the reasons that all roles and responsibilities should be agreed at the start.
How to Find a Co-Founder
Before looking for a co-founder, you should think about the type of person you want. Listing your own skills and abilities will help highlight where you need help and how another founder can fill in the gaps.
There are many ways to track down the perfect co-founder, including attending business networking events and basing yourself in spaces where other entrepreneurs hang out. Sites like Meetup.com and Eventbrite list events, while working from innovation spaces like Plus X Innovation allow you to connect with potential co-founders. You might also find a co-founder by joining innovation programmes such as those run by Plus X Innovation.
Going online is another route. You can use platforms like Co-Founders Lab, Founders Nation and Start Hawk, post in LinkedIn groups and engage with relevant Twitter hashtags. Other online options include audio services like Twitter Spaces and Clubhouse, where thousands of conversations about start-up issues take place.
You might also be able to find a co-founder among your family or friends. Knowing someone well is an advantage but bear in mind that running a business together might put a strain on your relationship.
Even if you decide not to go into business with a relative or friend, you could still ask them if they know someone else who might be interested.
Once you’ve found a co-founder, put together a formal agreement that outlines each other’s responsibilities and any equity structure for the business. You can find many free templates online.
Keen to meet and collaborate with fellow entrepreneurs? Book a tour of Plus X Innovation hubs in Brighton and Slough.
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