Update: Also see our 40-minute interview on this topic.
Picking a co-founder is your most important decision. It’s more important than your product, market, and investors.
The ideal founding team is two individuals, with a history of working together, of similar age and financial standing, with mutual respect. One is good at building products and the other is good at selling them.
The power of two
Two is the right number — avoid the three-body problem. Think Jobs and Wozniak, Allen and Gates, Ellison and Lane, Hewlett and Packard, Larry and Sergei, Yang and Filo, Omidyar and Skoll.
One founder companies can work, against the odds (hello, Mark Zuckerberg). So can three founder companies (hello, @biz, @ev, and @jack). In three founder companies, the politics can be tough — gang-up votes, jockeying for board seats, etc. — but it’s manageable. Four is an extremely unstable configuration and five is right out. When 4-5 founder companies work, it’s because two founders dominate.
Two founders works because unanimity is possible, there are no founder politics, interests can easily align, and founder stakes are high post-financing.
Someone you have history with
You wouldn’t marry someone you’d just met. Date first. Guess which pair of famous co-founders is in this photo:
Go through something difficult, like a Prisoner’s Dilemma or a Zero-Sum Game. If being ethical was lucrative, everyone would do it!
One builds, one sells
The best builders can prototype and perhaps even build the entire product, end-to-end. The best sellers can sell to customers, partners, investors, and employees.
The seller doesn’t have to be a “salesman” or “business guy”. He can be technical, but he must be able to wield the tools of influence. Bill Gates and Steve Jobs aren’t salesmen, but they are sellers.
Aligned motives required
If one founder wants to build a cool product, another one wants to make money, and yet another wants to be famous, it won’t work.
Pay close attention — true motivations are revealed, not declared.
Criteria: Intelligence, energy, and integrity
It’s not the kid you grew up next to. It’s not the person you like the most. It’s not the hacker most willing to work for free.
It’s someone of incredibly high intelligence, energy, and integrity. You’ll need all three yourself, and a shared history, to evaluate your co-founder.
Don’t settle
If it doesn’t feel right, keep looking. If you’re compromising, keep looking. A company’s DNA is set by the founders, and its culture is an extension of the founders’ personalities.
Pick “nice” guys
Avoid overly rational short-term thinkers. There are bounds to rationality. Partner with someone who is irrationally ethical, or a rational believer that nice guys finish first. Be especially careful with the “sales” guy here.
What you don’t know
Business founders who don’t code use bad proxies for picking technical co-founders (”10 years with Java!”). Technical founders who don’t sell also use bad proxies (”Harvard MBA!”). Learn enough of the other side to have an informed opinion. If you’re not seriously impressed, move on.
FAQs
What if the right guy already has his own startup? Convince him to work on yours part-time — he’ll drop his idea once yours gets traction.
Breakups are hard
If you’re going to fall out with your co-founder, do it early, recover the equity into the option pool to keep the company going, and recruit someone else great to fill the missing slot. Build in founder vesting (a.k.a. the “Pre-Nup”) to keep the breakup from getting messy. Building a great company without a partner is like raising kids without a…
Nearly everything I’ve written on this topic applies to dating and marriage. Coincidence?
Go forth and multiply.
Update: Also see our 40-minute interview on this topic.
This post is by Naval Ravikant. If you like it, check out his blog and Twitter.
# scott edward walker · Nov 12, 2009
Great post. Neil Patel, a very smart entrepreneur, also has an excellent recent post that you may want to check out: “Beginner’s Guide to Finding the Right Business Partner” (see http://bit.ly/1wQkbt). As a corporate lawyer for 15+ years, I just wanted to echo your sound advice that co-founders should impose reasonable vesting restrictions on the equity issued them. Indeed, as I discuss in a relatively recent post (see http://bit.ly/nYZM4), it would be inherently unfair for a co-founder to quit the venture after a few weeks or months, but still be permitted to keep all of his or her equity. Many thanks, Scott
# Ram · Nov 12, 2009
As you point out, there are several advantages to having 2 co-founders, but I think your perception/post exaggerates the odds against single-founder companies
From this week’s news, AdMobs is a great example of a successful single-founder company. See http://news.ycombinator.com/item?id=77525 for more data points.
# Raghu · Dec 6, 2009
Agree with Ram’s comments. See Amazon and Wipro, one founder companies but still kept going….
# Gabor · Nov 12, 2009
Great post!
Was Facebook really a “one-founder” company? Maybe I’m bad at my Facebook founding history, but it seems like there were multiple. It was one-founder in the sense that Mark Zuckerberg is both a builder and a seller :-)
I feel like there have to be more good examples of successful one, three, and four-founder companies. It seems like you dismiss anything else than 2 too quickly.
# Anonymous · Nov 12, 2009
So who’s the unnamed co-founder pair?
# Nivi · Nov 13, 2009
Both pics are Gates and Allen.
# Bruce Colwin · Nov 12, 2009
The photo up top of Bill Gates and Paul Allen looks like it’s from “Bring your son to work day.”
# Tobin · Nov 12, 2009
Love this post! I think finding the right co-founder is REALLY tough for a lot of people and this is great advice.
Trying it out for a bit is really important. One thing I’d recommend about the dating period is if you’re looking for a co-founder for an existing concept of an early stage product, present their participation as a “trial” before extending an offer.
When it comes to aligning motives I think one thing that’s important to look at if they are interested more in the rewards or the journey. The journey is more important IMO.
I would also add passion to the criteria. Intelligence, integrity, and energy are good but if it’s not put towards something they are passionate about then I think you lose a bit of the driving power for those qualities.
# TChan · Nov 14, 2009
Wow, you have perfectly describe the problem with my past venture. Got the idea for biz but my partner wanted the quick reward but not the up and down of the journey. I ended the partnership (remain friends). I realize not everyone have the passion and the drive.
I know a lot of people who want to be an entrepreneur but many do not have what I call the “survival gene”. The gene to make one take the step to do what they need to do to survive. Like doing something you never done before or you are afraid of. The same gene that drive you embracing and prepare for the unknown and not hide from it.
Having the wrong partner is worst than not have one at all.
Just watch the movie startup.com base on a real company.
# Anonymous · Nov 12, 2009
Ellison’s co-founder was Bob Miner. Check you facts……..
# Mark Essel · Nov 12, 2009
I love the power of 2. Excellent advice, although I don’t see 3-4 being a problem with the “right group”. Certain projects lend themselves to two, others can really get powered up by 3-4 founders. Engineer heavy startups are common now, so doubling or tripling your development team at the outset is incredible. It depends on what other responsibilities team members have as well. Many startups are grown while folks work their day jobs or part time (to survive).
# Spencer Fry · Nov 12, 2009
I’d say that you have to figure out what works best for you. You can’t slap a formula on it. Some people are more comfortable, and successful, working with one other person and others prefer a tight-knit team of three. I’ve been successful with both situations, but have most recently found that I’m more comfortable with two other co-founders.
# Trevor Owens · Nov 12, 2009
Great advice, have been looking for an article like this for a while. Thanks Naval.
# EventSession · Nov 12, 2009
Poignant and timely piece especially the bit about the power of two. Three is an infamously unstable number when it comes to human psychology.
As it happens to be, I am looking for a lead developer. VentureHacks was kind enough to tweet about it here:
http://twitter.com/venturehacks/status/5599787710
Anyone interested, please see:
http://eventsession.com/customer-development-oriented-lead-developer-for-start-up/
# Max Tobiasen · Nov 12, 2009
The primary problem of finding cofounders isn’t seeding out the bad ones, it’s even knowing someone you might want to found a company with.
According to the post your cofounder should be someone of roughly the same age and financial standing that you have a history with, have aligned motives with, has incredibly intelligence, energy and integrity. Oh, and it has to be someone that respects you and that you respect as well.
Personally I don’t know anyone that lives up to all of these criteria, and I doubt that most people do.
# April Smith · Nov 12, 2009
Thank you for writing such a great post! :)
# Kirrily Robert · Nov 12, 2009
This is a fascinating article, but I’m wondering — do women ever found companies? If I were to use only the evidence of this article, I’d assume not.
# Tobin · Nov 12, 2009
Off the top of my head women tech founders:
Caterina Fake – Flickr & Hunch
Jessica Livingston – Y-Combinator Co-Founder
Leah Culver – Pownce
# Rick · Nov 14, 2009
Mary Kay Ash. One of the greatest female entrepreneurs in American history.
Oprah Winfrey no need to say more
Joan Ganz Cooney is one of the founders of the Children’s Television Workshop (now known as Sesame Workshop).
Filipina blogger Shai Coggins, co-founder of one of the world’s biggest blog networks, b5media, has been cited by Fast Company as one of The most influential women in technology for the bloggers category.
Often, men help women get to the corner office
When USA TODAY asked female CEOs, chairs and company founders to identify the one mentor who had the most influence on their careers, 33 of the 34 who responded identified a man.
One reason the path to success for some women almost always leads through men may be the sheer matter of numbers: There are only 29 Fortune 1,000 companies with a female CEO and not enough other women in very high-ranking positions to do the mentoring.
The saying – If there is a woman behind every successful man, it may be as true that there is a man behind most every successful woman.
Sorry, husbands. He’s probably not you, but rather a male executive who champions women to the top.
# musti · Nov 13, 2009
finding a co-founder is something like finding a soul-mate.
when you find him/her, you feel you just cant start something without him/her.
if you ever feel like this that means he/she is your co-founder.
# David Gehring · Nov 13, 2009
Great post! Just partnered up with a friend for a new venture, and it seems our intuition is somewhat validated from this post….so, we’ve got that going for us, which is nice…
# Kevin Dewalt · Nov 13, 2009
Great article but unfortunately it doesn’t totally address the challenge that most of us face: We *know* what type of person we want as a co-founder but unfortunately we don’t have a sufficiently large number of candidates.
From this post you stress:
-Common work history
-Has all of the (many) intrinsic entrepreneurial qualities
-Has complementary skillsets
-Aligned motives
-Similar age
-Similar financial standing
To that I would add:
-Is available (i.e. not already on another startup)
-Does not have multiple small children (just my personal experience – I would not discourage any parent from pursuing his or her passion)
How many of us over the age of 35 have sufficiently large sample set of colleagues who fit this criteria? Not many. So by this logic are companies only started by recent college grads? Or are more successful companies started by just a single co-founder?
Given the choice of settling for a sub-optimal co-founder situation, continuing to search, going alone, or giving up, what should people do?
Really, this is the question that matters.
Finally, I would actually really be interested in seeing some rigorous social scientific analysis applied to this issue. How many companies are founded by 1, 2, 3, 5, or 8 co-founders? What is their relative success rate?
Entrepreneurship is a topic full of urban myths that need disproving such as the reality of Angel investing in America and most first time entrepreneurs are young.
Is the 2 co-founder myth yet another one?
# Peter Lehrman · Nov 13, 2009
Terrific post and tremendously useful to the entrepreneur. The challenge with co-founder structures is that there can ultimately be a dispute over ‘who is really driving the bus’.
I would therefore add one thing: before you decide to co-found a company, make sure you are 100% prepared to lose your friendship in order to save your partnership or save your friendship by ending your partnership. This isn’t pessimistic, it’s sheer fact. As your startup evolves, sometimes it’s clear that one of the co-founders is more relevant, more competent, more appropriate to really take the lead. Ideally, it won’t happen, but be sure you go into a co-founder structure eyes wide open.
# Vishal · Nov 18, 2009
Can you talk a bit about what makes two better than one?
Other than the statistical correlations that are out there that suggest two founders are more successful (which is debatable), what are the theories behind it?
# Elias Bizannes · Nov 22, 2009
Awesome post Naval, very well articulated.
Though would love you see you delve into the specifics of the two founders. I remember you talking about the alpha geek technical guy – would love to hear more. And then do it again with the business guy – who’s an API that the alpha geek can plug into, if I can quote a wise man :)
# David Park · Nov 24, 2009
Asking yourself and the potential co-founder some of the questions found in this article may be helpful to see if your interest and passion are aligned…So, You Want to Be an Entrepreneur – WSJ.com http://bit.ly/zHF4h
# C. Enrique Ortiz · Nov 24, 2009
Great post. As a previous co-founder of a startup that died mainly from the due to internal (inter-founder) differences and issues, I can say this post is right on the spot :-) Having the right co-founder is the most important 1st step of the company. For me I’ve always believe the right/magic number is two…
ceo
# Anonymous · Nov 30, 2009
Remember that success has many fathers but failure is an orphan.
# Marcos Polanco · Dec 9, 2009
Just got video of Hubspot CEO Brian Halligan addressing the factors in picking co-founders. You can find it here: http://bit.ly/6MtDtb.
# Sharel Omer · Jan 18, 2010
Thanks Naval, great post to go back to and remember how to do it right, when there is no specific right.
# Sergey S. · Jan 31, 2010
Taking time to learn more about your potantial co-founder ought to be the most important step in a start-up’s life.