Should I have a co-founder?

Fireside Chat Series — The Pareto team has given dozens of talks and fireside chats at universities across the U.S. and Europe, often with Cory Levy and the Z Fellows team. We frequently hear the same questions so I figured that I would memorialize some of my common answers here for whomever wasn’t in those rooms.

Short answer: You should not have a co-founder if you don’t already know them.

Would you marry someone whom you just met on the street?

It’s similar, actually.

I have always believed that the biggest asset of a startup is its founding team, much more than the idea.

But it’s also most often where something goes wrong. It is very tricky to combine a handful of people and have them work well together with high stress, long hours, high stakes, lots of opportunities for ego trips and blaming, and high chance of failure for years on end.

I am very bullish on investing in people who have already worked together, long time friends, and siblings. People who have already stress-tested their relationships and who have seen the good, the bad, and the ugly together.

If you do not already know your co-founder, it is better to make a little progress on your own, raise some money, and then hire someone as an early employee, because if it doesn’t work out you can more easily part ways.

An easy hack / compromise (if you must) is to try out working with someone for a few months, and if it works out to escalate it to something more serious, but the ideal scenario is when you have known someone for a very long time. There is no shortcut to getting to know someone.

Solo founders are often worried that they will be lonely. I want to reassure them: they will not be once they make a little progress and hire a team, and it is much better to build in this fashion than to get married to someone they barely know.

With an equal co-founder partnership it becomes much messier if things don’t work out. Just like a divorce.

This has been very much true in my case.

When I have teamed up with people I had never worked with or have not known well, on a whim, because it seemed convenient for X Y Z reason, it has *almost* never worked. Of course there are lucky exceptions, but you can always get lucky playing Russian roulette.

The co-founder relationships that have been most successful for me have been with longtime friends, because I know they are the people with whom I want to be in the trenches.

People often ask about whether building companies with friends is a good idea…

Yes, building a company is war. So you better be smart about whom you invite into your foxhole.