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How to Find, Vet, and Get Startup Co-Founders

how to find, vet, and get startup co-founders. how to find a business partner.

Photo by Gangplank HQ

Last updated October, 24th, 2017.

Going solo in your startup may work for a little bit, but eventually, you’re going to need help.  And that’s why you’re here, to learn how to find a business partner or co-founder for your business or startup.

A startup involves juggling so many different tasks and responsibilities.  We’re only human and there’s only so many things that we can do and be good at doing, nonetheless. It makes it even more important that we find capable partners or co-founders.

Did you know that, according to CB Insights, 23% of startup failures are due to having the wrong team?

A solid team is just as important as is the product/service you’ve created. If you want the best team, then you’re going to want to read this entire post, because you’ll get the most important information that you need to have to find the best business partners.

However, there are a few extremely important points that you MUST understand.

  • Your co-founder candidates are interviewing you just as much as you’re interviewing them.
  • The more successful they are, the more selective they’re going to be when choosing what startup to join.
  • Your pitch needs to be strong and your story needs to be compelling.

Most people will want to see some evidence of traction with your startup before they decide to join, unless they’re a college student or they’re less qualified or experienced, which in those cases, they will likely be less selective.

If they’re interested and you move to a phone and/or video conversation, don’t assume that they have already chosen to work with you. You need to continue to impress them, yet show confidence in yourself and show no signs of desperation.

How to Curtail Risk with Equity

You can always curtail the risk by making new co-founders sign a 2-year vesting agreement with six to twelve month cliff (one-year is better).

Vesting allocates their equity to them on each quarter over a span of two to four years. This way, if they leave before their vesting is finished, they keep what they earned and leave the rest to your startup.

The cliff is like an insurance plan because if the new co-founder doesn’t work out within the year (or however long you choose the cliff to be) and they leave or you have to fire them, your startup won’t lose any equity from that person leaving.

Equity matters even more if you’re planning on raising money for your startup, and it’s important to communicate that to your co-founder candidates.

It’s possible to raise money with VC’s as a solo-founder, but it doesn’t happen nearly as often as it does with teams with good co-founders. Investors like to invest in teams that will succeed.

So if you want to build a great team and not get destroyed by losing a teammate, make sure that you build in a vesting schedule with a cliff for each co-founder.

 

What to Look for in a Co-Founder or Business Partner

There has been a lot of talk in Silicon Valley and the startup world about “hiring rock star teams.” Remember that an individual’s value-system is just as important as their skills and experience.

I would take a person with tons of passion who’s willing to learn and put their all into a job but with slightly less skills, over a person with less or no passion and great skills.

The person with more passion will usually find a way to meet expectations. They want to make a difference. The person with no passion will be less likely to want to get things done. In a startup, you need to get things done.

 

Do They Have the Time?

First of all, make sure that they have the time to work on your project.

If they can’t dedicate at least 10 hours a week on top of their normal work schedule, then it’s likely that they won’t be a good fit. The more time they have, the better. But, that increase in time comes at a cost to themselves, which brings me to my next point.

 

Money

It’s incredibly vital to find out what their financial standing is.  A bad financial standing on anyone’s part can deal a huge blow to the startup if they have to leave because of it. Here are some questions to find answers to:

  • How do they support themselves? Wife/husband? Themselves? Joint-income?
  • Do they have a part-time or full-time job?
  • How long can they last on your startup without get paid from it?
  • Would they work for equity plus profit-sharing?

 

Location

Ideally, you want your business partner to reside in an area that’s somewhat close to you, especially if you’re seeking venture capital funding.

This is because you need to have a cohesive group of people who are used to working together, both in person and remotely.  An hour drive is the maximum amount of time you should ideally want between you.

When your team is splintered, it makes it more difficult for investors to want to invest in your startup.  Half of their investment is based on the team. The other half is based on your startup and its traction.

Even if you aren’t looking for investment, having a geographically close team will be beneficial.

You and your co-founders can then attend nearby events together, present at nearby events easily, have real in-person meetings, and learn more about each other.

 

Skills

Co-founders should complement your skill sets by covering the gaps of what you don’t have skills in.

The startup titans say that the best practice is to find people who are as smart as or smarter than yourself.

As I mentioned earlier, passion + skills play a role in hiring, but they can also be highly intelligent, yet less skilled in areas. And they will definitely improve.

Surrounding yourself with these types of individuals will yield high dividends for your startup, your personal development, and professional development.

However, intelligence is not the only litmus test that a potential partner should be judged on.

It’s best to find people that have as close to five years of experience or more in their discipline.

Five years is the magic number because it’s said that about 10,000 hours of work is needed to gain mastery in a subject.  Each year has 2080 work hours (52 weeks x 40 hours) and when you multiple that by 5, you have 10,500 hours.

Some people are quick learners and they can excel in a role with two or three years of experience. Don’t count them out.

 

Being Selective in Who You Choose

You want to be very selective when bringing on a co-founder.  It’s like a marriage and has legally binding implications as well.

So many startups fail because of issues with business partners. I’ve been in these situations before and you do not want your startup failing because of bad co-founders. You will want to vet that person thoroughly.

And, you want that person to align with the core values that you want to set for your company culture.

From the get-go, as a founder, you should create a value-system for your startup and how it works. Figure out what type of company you want to have in terms of company culture.

When you speak with potential candidates, it’s important to ask them what they envision as a good company culture.

 

Ask them what values they have in regards to:

  • Their work ethic
  • How they communicate
  • What their best practices and processes are
  • Their productivity and time-management
  • Honesty
  • Transparency
  • Goal setting
  • Deadline setting
  • Working under pressure
  • How much time can they commit per week?  How will they allocate their time spent?
  • What do they eat? (junk food vs clean, whole food). You can tell a lot about people by how they eat.
  • How often they exercise (steady exercise increases productivity, mood, and cognitive function)

Learning More about Your Potential Co-Founder & Their Background

It’s important for you to get to know the person you’re considering on a human level.

Learn about their interests, motivations, experiences, marital status, living situation, political affiliation, and find out if they are financially secure (bad financial situations can make or break it).

Find out what makes them tick because you should be prepared to be dedicated to your startup for up to ten years and perhaps longer.

That means a lot of time will be spent with your business partner(s).

Ideally, you will want to have some common interests with your business partner.  Having something else to bond over besides work is nice to have, but not necessary.

It’s necessary to hustle together, but you need a little downtime too.

Do you know that saying, “all work and no play makes for a very dull day?”

Well, one of the top 20 reasons for startup failure is burnout. So make sure that you and your future business partner can recognize when it’s time to stop working and time to start relaxing.

Even if you and your co-founder go watch a movie together, it will help you to unwind and give you a little something to bond over.

 

Sharing Your Vision

Share your vision of the company and what your roadmap will look like.

Be honest with what you’re looking to do, such as crowdfunding, equity crowdfunding, getting angel investment, venture capital investment, applying to startup accelerators, bootstrap, get a bank loan, etc.

Tell your potential co-founder how much equity you want to reserve for investment.

Let them know if you’re looking for other co-founders to fill different positions.  If you are, share with them your plan of how the equity pool will be divided.

Last but not least, share your vision for how you want to run the company.

 

Where to Find Co-Founders & Business Partners

Below, you’ll find out how to find co-founders for your startup so that you can start building your rock-star team.

 

CoFoundersLab

The best place to look for a co-founder is CoFoundersLab and they recently acquired FounderDating and merged all of the profiles from there into CoFoundersLab to have the largest network of founders and potential co-founders on the planet.

This is where you will find the largest concentration of people who are looking to join startups or are looking for others to join them.

You can also find mentors/advisors and interns there.

To get the most out of CoFoundersLab, you’ll want to get their premium service so you can message as many people as you want per month.

Make sure you create a good profile that speaks about yourself and your experience, your startup and its mission, what you’re looking for in a co-founder, and what you’re looking to offer in return for them becoming a co-founder of your startup.

Just like dating, never look desperate.  People will notice it immediately.

 

LinkedIn

You can search on LinkedIn for co-founders. But, how? You may ask…

Reach out to your connections and ask if they know of anyone that might be interested.

Join groups on LinkedIn that will have the type of co-founder you’re looking for. For example, if you’re looking for a marketing co-founder then look for groups of marketers in your state.

You can also search by typing in the role you want in the search bar. Then select groups on the left criteria pane.

When you select groups, then make sure you type in your state or location next to the role you’re looking for up in the search bar. Once you’re approved to join the group, you can start messaging people within it. This tactic may work better or worse for each different discipline.

Another way to go about finding someone via LinkedIn groups is to join non-location-specific groups and then post what you’re looking for on the discussion board including information about your startup to pique their interest.

If you want to search for people, then type in the role in your search or nav bar such as “marketer” or “programmer.” Then select people on the left criteria pane, and then sort by location by clicking the area that you most closely identify with. Then start checking out their profiles. You can save their profile to PDF for free by clicking the drop-down arrow next to the buttons to connect and send xyz person inmail.

 

Go to Meetups from Meetup.com

In a similar fashion to that of LinkedIn, you want to target the meetup group based on the skill sets desired.

So, using the marketing example again, look for meetup groups in your area that are for marketers.  Request to join those groups. Once you’re approved you can then message group members and attend their meetups.

Then, all you need to do is have your startup’s elevator pitch together so you can pitch marketers, programmers, or whoever you’re looking for when you meet them at these meetup events.

If you find someone that seems interested, set up a meeting with them to talk about it further.

 

Join Facebook Groups

Find Facebook groups that match the discipline of the person you seek as well as groups that target people of that role in your area. Then post in the chat what you’re looking for and about your startup.

Once you’re approved you can then, also, message group members and attend their meetups.

Another way to go about finding someone via Facebook groups is to join location-specific groups and then post what you’re looking for in the group chat including information about your startup to pique their interest.

 

Use AngelList

AngelList is a top platform for finding jobs in startups, posting jobs for your startup, investing in startups, and more.

By going to http://Angel.co, you can then easily create an account to get started.  Then, assuming you’re looking for co-founders, you then would go to https://angel.co/recruiting, click “Get Started Now,” and fill out the form fields to post the job.

Alternatively or additionally, you can just network with people using your personal profile and see if they are interested in your open role(s).

 

Get on Witty

Witty is the newest of the networks in this post, but it has quickly become a contender in the search for startups looking for co-founders. And, they have an incredible base of people using the network.

To create a profile and join, it’s a very seamless process. You can join via social logins from Facebook or Google. You can connect your LinkedIn account to import your work experience.

It brings startups to focus similarly to that of startup visibility networks (distribution firehoses), and people can upvote them so you have a shot to appear on their home page as a featured startup.

If you invite three of your friends, you’ll get a premium lifetime membership to the network. The more people you invite, the higher your personal profile ranking will increase, too.

 

What to Message Your Top Picks for Potential Co-Founders

Write some drafts about what you want your message to look like first.

A successful message I’ve used to generate discussions with potential co-founders looked like the following script:

Hi Matthew,

Your work history and profile is impressive. One of the things that really stood out to me was your work at _______ because you were able to do _______.

The reason I’m contacting you is because I’m looking for a person with the same skill sets you have, to join as a co-founder for my growing startup, __________.

My startup’s mission is to ___________________________________. I plan to make money with it by doing ___________ and __________.

I’m looking for someone that can dedicate X hours per week and I’m offering ____% in vested equity [plus revenue sharing].

Based on your skills and profile, I think you could be a good fit but I’d like to explore this great opportunity with you to see if we are indeed a good fit for each other.

Are you interested in exploring the opportunity with me? If not, do you know anyone that might be interested?

Kindly let me know at your earliest convenience. Thanks.

Best regards,

Carl

 

Reaching an Agreement

Once you and your potential co-founder have gone through the process and decided you both want to work together, it’s time to set clear expectations.

The expectations should be specifically expressed in a partnership agreement with the amount of equity that will be split up.  Usually, it’s best to play it safe by putting your new partner on a vesting schedule that gives your new co-founder equity over each financial quarter.

The amount of time spent on your startup each week and by each individual should be clearly expressed, as well.

If you decide to split the equity 50/50, then you must create a framework of how disagreements will be handled and resolved.  Usually, it’s the CEO that has final say.  Even if it’s not a 50/50 split, it’s a good idea to figure that framework out and communicate that in writing to your new co-founder.

Non-disclosure agreements are mainly a thing of the past for most founders seeking co-founders, but there are some instances where it is still appropriate.

Most people are not looking to steal others’ ideas. They’re focused on their own ideas too much or joining a team that is working on a great idea.

However, you can issue a non-compete agreement to your new co-founder if it makes sense for you.

 

Conclusion

You can find potential co-founders via CoFoundersLab, LinkedIn, Meetup, Facebook, and Witty, and have multiple ways to go about it for each website.

This will keep you pretty busy on your search for a co-founder. If you dedicate 1 hour a day to prospecting, you should be able to find someone within a couple of months of steady effort.

Good luck!!

 

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