5 tips for choosing a co-founder

October 8, 2009 | Mike McDerment | Comments | |

(Editor’s note: Mike McDerment is the co-founder and CEO of FreshBooks, an online invoicing and bookkeeping app. This story originally appeared on the company’s blog.)

They say choosing your partner is the most important decision you will make in life. I’d say choosing your co-founder(s) is the most important decision you will make in building your company. Here are five tips to help you choose wisely:handshake

Demand Passion – Starting a company is lonely, thankless and costly. It will test the deepest fibers of your being. The only thing that melts these obstacles away, leaves you raring for more, is passion. You can’t fake passion. It lights up your eyes and charges your voice when you talk about what you love. If you have a great idea, and you want to bring it to life, find someone who is passionate about your vision.

Trust – You either have it or you don’t. When the dark clouds come – and they will – you find out really quickly if you trust someone. When your mortgage is on the line, you better have trust. Mistrust is a cancer in relationships; it breeds sleepless nights and suspicion. The good news is you can avoid it by choosing a founder you trust, then work to foster deeper trust in your relationship over time. Keep in mind that it’s a never ending process.

More than Money – There’s more to life than money, and chances are money is a long way off if you are building a company. So again, find someone with passion as they are sure to be in it for more than the money.

Choose your Complement – Like a partner, a co-founder should be strong in areas you are not. A great complement to your skills is someone who loves to do things you hate, someone who makes the sum of your parts greater than the whole.

Give them Equity – This may seem like a no-brainer when founding a company, but I meet people who expect others to care as much as them about the business when they don’t own any of it. If you believe they will if they don’t own a piece of the business you are seriously deluded.

Photo by Andyrob via Flickr

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About the Author, Mike McDerment

Mike McDerment is the co-founder and CEO of FreshBooks, planet earth’s leading online invoicing and bookkeeping app for service oriented professionals, freelancers and teams. Back in 2003, Mike built FreshBooks for his design firm and scratched his own itch. Since launching in May 2004 FreshBooks has touched over 1,000,000 lives and Mike and his team dedicate themselves to being a great service for people who love their work, and want to focus on it – instead of focusing on their paperwork. You can read more from Mike over at FreshThinking.

  • Great thoughts. However, I'd rather pick a co-founder who complements my skills than one who compliments them! That is, unless you have low self-esteem and you need the compliments.
  • IGT
    Having a compliment and getting compliment are different things and I think it wasn't worded properly. If you are 60% percent of what your company needs, you need the other 40% to make your company whole, and best scenario would be 50/50 but that rarely is the case. The trust and passion is my big issue with finding my business partner so far.
  • wolfmanjeffrey
    That’s a good point and the article hits on a few points I’m personally experiencing myself. In staring my own venture to establish a new internet service here is what I’m facing now:

    1. This is a very lonely and hard road, I’m only speaking with those who share a vision and who can mentor me through this process.

    2. Finding a good co-founder is turning out to be very frustrating and it is everything the author said it would be. I first started with a friend of 15 years in the IT business and he liked what I was doing. But after he stopped retuning my calls to meet about various aspects of the venture, I knew he lost interest and I have to look elsewhere. It’s not worth the aggravation to keep a potential co-founder if they can’t weather the early days, even if there a good compliment to your weaknesses.

    3. Everyone and there mother will come out of the woodwork to offer you help “after” you raised startup money (by yourself and alone). Be careful, ask yourself, and even test those in your circle, Who will be there when the dark days come and who will ride out the storm with you?
  • I agree with Mike Feinstein. Not much substance in this post based on my own experience in previous startups.
  • Thanks for the spelling aide everyone...funnily enough, details (like spelling!) are not my strong suit. That's why it's good to find a co-founder who has those strengths...and likely a good idea to get that co-founder to proof read your blog posts too. ;)
  • Unless I'm missing something, I don't understand all the comments about "complimenting" when the author was speaking of "complementing." If you are going to take the time to comment, please make sure you are responding to something real rather than imagined!

    Anyway, I just wanted to say that in working with startups as clients, I've observed that many of the attributes of a co-founder are in some ways applicable to the senior team. Even if not actually functioning in the role of co-founder, your initial leaders/executives in effect fulfill some of the same purpose and if equity extends to these roles, you are more likely to find people who fulfill the first three requirements listed. Great post because it hits at the heart of what is needed for any startup to succeed -- in terms of bringing the right people on board.
  • Gidi
    As an experienced entrepreneur I realized that finding the right co-founder is a huge challenge.
    I decided to confront this challenge and to develop together with a group of Psychologists an online matching tool that will help entrepreneurs to evaluate potential partners.

    We will be happy to get some feedback regarding the willingness of entrepreneurs to use an online matching service and to pay for it.
  • Name
    Gidi - sounds like an interesting idea. As an entrepreneur, this is something I'd be interested in encouraging. If you need any input from a focus group perspective, do post your contact details here.
  • Gidi
    Yes we would like to get your input.
    gidi.gideon@gmail.com
    Thanks a lot
  • As an explainer for Donna and others who came into the conversation a little later than others: There was a spelling error in the original version of this story (Compliment instead of Complement). Once our readers pointed it out, we corrected the error. Sorry that got missed. Guess I wouldn't be a good co-founder, Mike, since it flew right past me too. :)
  • Well, in that case, I apologize for my "rebuke" earlier. Peace, comrades.
  • Founder
    Also, be prepared to recognize if/when the co-founder is no longer the right person for the role and act swiftly to remedy the situation. Running a business demands that you separate friendship from work. As a company grows, so must the people involved, and while you hope that all members of a founding team can fit the changing needs of the company it doesn't always happen.

    Be straight about this and deal with it as directly as possible. Try to stay out of the emotion that can make any transition much harder than it inherently would be.
  • Good thoughts. But there are few more that I would ad.

    1) do a reality check on the Ego of your potential co-founder. Ego clash more often then skills deficiency is a reason for partners break up.
    to avoid that
    2) check few different psychological profiles and see if the compatibility is there. For example if one uses Myers Brigg, I saw interesting conflicts between ENTP and ENFJ. Some people look at the world from different angles (in this case perceiving vs judging and feeling vs thinking). It doesn't mean that the combination would not work, but looking at some history and potential outcome would not hurt. I personally wouldn't want to have to spend hours and getting agreement on some fundamentals that "like-minded" people could settle in few minutes.