The most important lessons startup founders learned during COVID
Liz Eddy and Alyssa Ruderman started Lantern, an end-of-life planning company, and realized the depth of their commitment to each other.
“We basically got married, just without the DJ,” said Ruderman, Lantern’s chief operating officer. “When we filed the incorporation papers for Lantern, Liz was the only person in my life that I was legally bound to.”
The co-founder relationship is perhaps the single most important in a company. There are quizzes and compatibility questions for potential founders to ask before they go into business together. Meanwhile, reams have been written on managing up and managing down, less so about managing across. Startups, scrappy and predictive by nature, offer broad lessons and application to the future of collaborative, complementary work. What does it mean to really work with someone instead of for them? That’s a question all of us, regardless of the size of our workforce, need to get more comfortable with in the post-pandemic economy.
What to ask before you commit
A list of key questions Eddy shared:
- Do you align on the overall vision and core values of the business?
- Are your communication styles compatible?
- Are you comfortable with delivering and discussing both good news and bad?
- Do you have similar ideas on how the company can/should exit?
- Are you both comfortable with the unknown of start ups? The highs and lows?
- Are you naturally cheerleaders for one another? Do you feel positive and excited about the future of the business and each other after being together?
Her co-founder’s list had a lot of overlap—with two additions. Ruderman said: “Can you disagree? We have one key rule when we disagree and it’s to always assume best intentions. Because of this rule, we can argue with respect and without defensiveness and ultimately land on the same page.” And don’t forget: “Do you like each other? This one is simple. You’re about to spend a ton of time with this person.”
Anshu Prasad, founder and CEO of shipping platform Leaf Logistics, adds:
- How will we make decisions, specifically who has the tie-breaking vote?
- What types of decisions require consensus (as limited a list as possible)?
- What are the expectations on the role each of us is playing in the business over time?
Indeed, these long-term goals matter immensely in the beginning to gauge compatibility, said Katie Curnutte, partner of Kingston Marketing Group. Including the most basic question: Why are we doing this?
“Is it money? Is it a lifestyle? Some combination of the two? You must be very much on the same page,” she said. “But then you need to dig deeper and look at potential scenarios. You can never predict exactly how something will play out, but if you spend time and a decent amount of brainpower on it, you’ll be able to approximate different scenarios, and decide ahead of time how you’ll respond.”
The case for a technical founder
On any given networking group for entrepreneurs, the query appears regularly: Do I need a co-founder steeped in technology?
The answers on this vary. Chia-Lin Simmons, the CEO and co-founder of LookyLoo, an AI-powered retail and shopping platform, says it really depends on the type of company. Also an investor in startups, she says rare is the company that doesn’t need technical expertise. “Non-technical co-founders are often the one that fundraises and your technical co-founder keeps the development moving while you take a step back from the product,” she said. “I am a fan of investing in companies that can keep moving and it’s easier when you have at least two people as co-founders. This is not to say that there have not been successful startups with only non-technical founder(s), but it increases the risk that many funders often like to avoid.”
How to communicate
Some daily check-in with each other is needed, the founders all said, with flexibility and understanding to move or cancel. Most said they use Slack for regular updates and communications, with scheduled Zoom or videoconference weekly. In-person meetings, even during COVID, have been rarer but necessary.
“Even during COVID, we’ve made time to see each other (outside, socially distanced) and have braved cold and rainy weather because it’s so valuable to be in the same place at the same time,” said Curnutte. “The strategic thinking and alignment you need for success depends on stepping out of the day-to-day and focusing together—that can be hard to do if it’s only online.”
You can also look to past failures of communication in previous jobs for inspiration, said Ellie Bahrmasel, co-founder and CEO of Further Faster Venture Studio in Chicago, which advises startups. “After my previous cofounder relationship, I was very adamant I wouldn’t put myself in a position where there wasn’t true shared decision-making power and transparency around intention,” she said. “If you have silos in your earliest days it will perpetuate in the life cycle of the company.”
The right division of labor
This also varies by skillset, needs and expectations. Because startups are so all-in, Eddy reminds founders: “You can be both the leader and the support.”
In Lantern’s division of labor, she said, “Liz is all things external, Alyssa is all things internal. This doesn’t mean that we don’t do things together or sometimes support on tasks that fall into the others’ domain, but, there’s never a question of who has overall authority and responsibility.”
How to be alone
If this sounds time-consuming and unnecessary, it might be. The search for a co-founder could be better spent building the business, said Ambika Nigam, founder of Zeit, a career-discovery platform.
“Fundraising is still the most popular way to get startups off the ground and the VC mindset is they like to see multiple cofounders,” she said. “There’s nothing wrong with getting founded that way. It’s the fastest way to unlocking dollars.” But not the only way, she reminds. Female entrepreneurs, she noted, might feel they need a co-founder when really a mentor or a cohort suffices.
After founding BeLoved Pet Sitting and launching products alone for a decade, Susan Kaplan was excited to find a co-founder for her next business venture Packagerz, smart lock boxes to protect packages on your front porch from being stolen after delivery. About seven months in, her partner began saying he cared more about his other company. “‘This company is not a priority to me,’” she recalls he said. “That was the day I was like, ‘Oh this is not gonna work.’ You can’t have a cofounder look you in the eye and say this is not my priority.”
After they parted ways, she found a mentor through Score, the small business mentoring organization, and discovered that was what she probably needed all along: Someone to gut check with, and share ideas and enthusiasm.
What collaboration looks like now
Even as offices begin reopening, co-founders say they are building toward a future that combines remote and in-person working arrangement. Says Simmons: “The future generation of workers value the ability to have flexibility in their location and time, sometimes over other benefits. So our job was to build a framework that would allow them to do that and for the company to still deliver on its products and services.”
In her book “Cofounding the Right Way,” Jana Nevrlka lays out ways to both nurture and futureproof partnerships; planning for worst-case scenarios need not weaken a bond. “Many entrepreneurs devote a lot of their resources to developing the right idea, the right product, the right service, the right business plan,” she said. “…the right team is the base with which you can build all of that and very often this aspect is underestimated.”
Visit Fortune’s SmarterWorking Hub presented by Future Forum by Slack. And read more here:
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