resource: the founder’s dilemmas
topics: founding team
purpose: help (prospective) startup/biz owners by presenting key questions to ask yourself, your partner, your team to avoid pitfalls
11 questions to ask yourself and your team:
1) what is your primary motivation, wealth (rich) or control (king)?
“wealth and control are decoupled for entrepreneurs and indeed, in active conflict. As a result, few founders of high potential startups can achieve both wealth and power” – page 19, founder’s dilemmas
“a founder who knows whether wealth or control is his or her primary motivation will have an easier time making decisions and can make consistent decisions that increase the chances of reaching the desired outcome – Rich or King”
page 14, founder’s dilemmas
2) what is your partner(s) primary motivation, wealth (rich) or control (king)?
3) what is your cofounder’s risk tolerance, personality, time horizon, commitment level, value system, and decision making style?
“a potential cofounder’s resume may not tell you much about his or her risk tolerance, personality, time horizon, commitment level, and value system. Founders tend to neglect these ‘soft’ factors because they are harder to assess than skill compatibility and function backgrounds, but they can become serious problems even for the most well-matched team.” – page 96, founder’s dilemmas
4) what are your co-founder(s) collaboration style?
“sharing the idea with a potential co-founder can help the founder articulate and enhance it. ” – page 80, founder’s dilemmas
5) what support/validation does your co-founder(s) provide? is that something you want?
“a core founder who has a strong need for affiliation, validation, or psychological support may seek cofounders, even if they add little capital to the startup.” – page 80, founder’s dilemmas
6) what are your functional backgrounds (ex: product development, marketing, sales, finance, HR, software development, etc..)?
7) what are your gaps/weaknesses?
“Founding a startup requires the knitting together of all of the functions required to make an organization run effective, from product development to marketing, to sales, to finance, and human resources. Having prior experience in those functions arms the founder with the ability to understand how each one operates on its own and as a part of the larger whole” – page 39, founder’s dilemmas
8) what are your co-founder(s) task preferences?
“a core founder who has all the requisite skills, contacts, and seed capital but dislikes carrying out one or more of the critical early-stage tasks my look for a co-founder to take on those tasks.” – page 79, founder’s dilemmas
9) what add-on capital do you contribute (social, financial, human)?
10) where are you lacking?
“social capital is the durable network of social and professional relationships through which founders can identify and asses resources.” – page 47, founder’s dilemmas
“The accumulation of one type of capital can spark a virtuous cycle. Research has shown that people who accumulate more social capital before founding are able to attract more human capital (such as co founders) and financial capital (such as seed capital) with which to launch the startup, and do so more quickly.” – page 48, founder’s dilemmas
“Human capital includes the explicit knowledge derived from formal education and the tacit skills derived from prior experience.” – page 77, founder’s dilemmas
11) how can you maximize shared work experience prior to founding with a team or cofounder?
“teams of prior coworkers were significantly more stable than both teams who had prior social relationship and teams of strangers.” – page 101, founder’s dilemma’s
“across a variety of entrepreneurial contexts, research as shown that teams with greater shared work experience have higher growth rates, higher levels of social integration within the group, and lower risk of company dissolution.” – page 103, founder’s dilemmas
“trying before buying” – page 96, founder’s dilemmas