A recurring theme with entrepreneurs and startup founders I’m coaching is their relationship with their cofounders. Statistics confirm it’s a thorny issue and the number one reason why startups fail. According to Noam Wasserman, author of The Founder’s Dilemma, 65% of startups fail because of cofounder conflict.
As a coach to entrepreneurs and startup founders, I’ve seen a recurring theme: their relationship with their cofounders. It’s a thorny issue and the number one reason why startups fail. The statistics back it up, too. According to Noam Wasserman, author of The Founder’s Dilemma, a staggering 65% of startups fail because of cofounder conflict. That’s why it’s so important to get this right, and why coaching can be such a valuable resource for entrepreneurs looking to build a successful startup.”
Now let me say this: managing a startup is no easy task. As your venture grows, you’ll encounter a whole host of challenges, from diverging visions to tricky decision-making to communication breakdowns. And that’s where the importance of cofounder relationships comes in. It’s essential that you get this right if you want your startup to succeed. So first, let’s take a look at the do’s and don’ts of managing your relationship with your business partners. And then, we’ll explore how a coach can help you navigate these treacherous waters and keep your startup on track.
- Communicate – Communication is absolutely key when it comes to building a strong cofounder relationship. In fact, it’s one of the most important aspects of any successful partnership. A study by researchers from Stanford University suggests that effective communication helps to prevent conflicts and build trust among cofounders. On the flip side, lack of communication is one of the main reasons cofounder relationships break down. A study by McKinsey & Company found that poor communication leads to misunderstandings, delays, and conflicts among cofounders. Therefore, ensure you communicate effectively with your cofounders and keep them updated on the progress of the business.
- Maintain a friendship outside of the business environment. When it comes to building a successful partnership, it’s not just about communication in the boardroom. It’s about building and maintaining a friendship outside of the business environment as well. When you make time for the informal moments, those times when you can just relax and let your guard down, you are not just building a relationship, you’re strengthening it. And that’s what it’s all about, because when you’ve got trust, everything else falls into place. It means you can work together, you can back each other up, and when things get tough, you can handle it together.
- Set clear expectations and even create a Cofounder Prenup: Before starting the business, it’s essential to discuss each other’s expectations and agree on the role each cofounder will play. A study by Harvard Business Review found that agreeing on the expectations of each cofounder is a critical component of a successful cofounder relationship. Now, let’s say you’re starting a company with a cofounder. You’re in it for the long haul, so is your cofounders you hope. But what if things don’t work out the way you planned? What if your cofounder has a change of heart or wants to become of a Buddhist monk, or something unexpected comes up? Or the problem could come from you. Hopefully, it won’t happen, but it could. And that’s why it’s important to have those tough conversations up front. It’s like a prenup but for cofounders. You want to ensure you are on the same page about your values, culture, where you want to be in ten years, and even how you work. It’s not legally binding, but it’s a way to protect yourself and your business.
- Respect each other’s opinion: Each cofounder brings unique skills and perspectives to the business. It’s essential to respect each other’s opinions and work together to make decisions that benefit the business. A study by Entrepreneur suggests that respecting each other’s opinions helps cofounders to work collaboratively and avoid conflicts.
- Celebrate success: It’s crucial to maintaining a positive cofounder relationship. Acknowledge the contribution of each cofounder and celebrate milestones together.
- Don’t make assumptions: Assuming that each cofounder knows what to do without clarifying expectations can lead to conflicts. Clarify expectations and discuss each other’s roles and responsibilities. Reassess your roles along the way if need be.
- Don’t make decisions in isolation: Making decisions without consulting your cofounders can lead to conflicts and mistrust. A study by the Journal of Business Venturing found that cofounders who involve each other in decision-making tend to make better decisions and are more satisfied with the outcome.
- Don’t ignore conflicts: Conflicts are bound to happen in any relationship, including cofounder relationships. However, ignoring conflicts can lead to resentment and long-term damage to the relationship. Address conflicts as soon as possible and work towards a resolution.
- Never ignore the warning signs: Even if everything seems fine on the surface, it’s important to keep an eye out for warning signs that things may be going off track. Whether it’s a breakdown in communication, a shift in priorities, or any other kind of issue, it’s crucial to address these problems with your partners as soon as possible. The longer you let them fester, the more difficult they become to resolve. So deal with the issues head-on, and you’ll be better off in the long run.
Getting it all together
Bottom line, managing a solid relationship with your cofounders is an absolute game-changer. You need clear communication, a shared vision, and mutual respect. That’s the only way you’re going to build something that lasts. And when you hit those milestones, you’ve got to celebrate them like you just climbed Mount Everest. Conversely, there are some major pitfalls you’ve got to avoid. You can’t assume everyone’s on the same page, you can’t make decisions in isolation, and you can’t just ignore conflicts and hope they go away.
But let’s be real here, managing a solid relationship is not easy. When you’re under pressure, and things get tough, it can be hard to keep everything on track. That’s why having a coach can be incredibly helpful. With the right guidance, you can avoid some of the common pitfalls and make better decisions. It’s like having a trusted advisor who can help you steer the ship and a trusty co-pilot on a bumpy ride. That can make all the difference in a startup.
Uncovering the vital role of a coach
Beyond just guiding you in your vision, productivity, and idea creation, a coach can also be invaluable in managing your relationship with their cofounder. This is no small matter and can often be the difference between success and failure. With the right coaching, founders can develop the skills and strategies they need to build a strong, productive partnership with their cofounders. It’s all about working together to create something greater than the sum of its parts, and a coach can help make that happen. How? Here are a few areas where a coach can support you:
- Facilitating open communication: A coach can encourage you to communicate openly and honestly with your cofounders. By facilitating a safe and open space for dialogue, the coach can help the founder to express their thoughts, feelings, and concerns without fear of judgment or retribution.
- Identifying and addressing underlying issues: A coach can help you identify any underlying issues that may be causing tension in your relationship with others. This may involve exploring the root causes of conflicts or misunderstandings and developing strategies for addressing them.
- Developing conflict resolution skills: A coach can help you develop skills for managing conflicts in a constructive and productive manner. This may involve working on active listening, reframing, and problem-solving techniques.
- Establishing clear roles and responsibilities: A coach can help you establish clear roles and responsibilities for each person. By doing so, you can reduce the likelihood of misunderstandings and conflicts arising from a lack of clarity about who is responsible for what.
- Building trust: A coach can help you build trust in each other. This may involve working on building a foundation of shared values and beliefs, encouraging mutual support and respect, and celebrating successes together.
Last word of wisdom
Overall, a coach can play a critical role in helping startup founders manage their relationships with their cofounders. By promoting open communication, addressing underlying issues, developing conflict resolution skills, establishing clear roles and responsibilities, and building trust, a coach can help the cofounders work together more effectively and achieve their shared goals.
As a coach, my role is to be a present and mindful thinking partner in thought. It’s not about doling out advice – it’s about being a strategic partner fostering innovation and empowering founders to achieve their goals. But there’s one piece of advice that I believe is essential for success in the startup world: Prioritize communication. If you want to build a successful startup, you need to make sure that everyone on your team is on the same page. That means communicating effectively and efficiently. The constant practice of prioritizing communication will bring you closer to the state of true success.
About the Author: Philippe Gelin is a maverick entrepreneur turned business and life coach. He practices a range of creative coaching techniques to help impactful startup founders, entrepreneurs and executives develop their vision, empower their community, and unleash their true power.
You can contact Philippe here