Should I find a co-founder?
Welcome to a new series of articles aimed at helping entrepreneurs and founders to start and scale a business. In this series we will be going back to basics and examining some of the questions and areas of concern that many founders or would be founders have. Whilst ‘basic’, nevertheless these topics can be fundamental to setting an early-stage business on the right track for success.
Perhaps one of the first basic questions that many founders ask is whether they should start a business alone or with one or more co-founders. This is of course very personal and much of this will depend on your personality or indeed whether the idea for the business came about solely by yourself or in conjunction with one or more other people.
As a sole founder you are free to make all the decisions and decide what to do, how to do it, and when to do it. There won’t be differences of opinion or clashes in style or approach. This level of freedom can be very appealing for many; especially those that have broken free from the tight management controls that can often be imposed when working for many a large corporate.
Being a sole founder does also mean that, initially at least, you will own 100% of the business. This will put you in a better position when it comes to raising finance and the diluting effect that this will bring. It should be noted though that some investors can be much more cautious about investing in a business with a sole founder as it raises the risk of the business failing should something happen to the founder.
The downside of being a sole founder is that there is often nobody closely involved in the business that you can share thoughts and ideas with or share the burden of making decisions. Often, initial ideas can be improved upon and refined by talking them through with somebody, and this is especially true if it is a co-founder.
Sharing the responsibilities of being a founder also means that there is somebody else with the same degree of commitment as you that will drive and scale the business and even to inject funds during the initial stages.
Every early-stage business will go through periods of stress for one reason or another, whether this is sales, cash flow, product or service development, raising finance, or any one of many more areas that are commonly experienced. Not only do these times cause stress but they also normally require urgent action and need more time being spent on them to resolve the issue. This can be very much easier if you are not alone.
But perhaps the best argument for having a co-founder is that each of the founders brings different experience and talents, and these skills complement each other in a way that means that the business is supported in more ways than just you as a sole founder could do. This aspect alone can mean that the businesses flourishes, and scales more quickly than it would as a soul founder. We will explore later in the series the importance of working with the right partners, but a co-founder is the closest business partner that you will ever have.
Whether you start a business as a sole founder or a co-founder then would normally stem from your own individual personality and the circumstances surrounding the initial idea. But whichever you choose will also then dictate the best steps to take in order to build on your chosen structure. Just make sure that you properly understand the benefits and drawbacks of each before you decide.