I’ve been looking for a co-founder for some time and have just been introduced to someone who seems to fit the bill – they have good experience, technical skills and seem nice enough. But should I really go into business with someone I’ve known for just five minutes? Or should I get to know him a bit better first?
As a first step, it is vital to agree upon a MOU (memorandum of understanding) that takes you both beyond the fabulous first five minutes along a journey of discovery.
Both potential partners need to treat building the business as the equivalent of moving from an early dating size-up, through courting to a more serious formal engagement.
You and your new partners must use the MOU to spell out your rights and responsibilities in a written partnership agreement. This agreement sorts out how you will settle conflicts and misunderstandings in advance, so they do not become full-blown disputes.
The MOU allows you to structure shared contributions in a way that truly establishes the nature of co-founder relationships.
You and your partner can establish the shares of profits (or losses) each partner will take, the responsibilities of each partner, and what will happen to the business if a partner leaves.
A desirable co-founder is a competent, caring and compatible individual who is ready, willing and able to take the shared risks associated in starting a business, charity or some other enterprise and prepared to invest time and effort in birthing a good idea.
Initially it is wise to treat your potential partner as a colleague – as business associate who shares your values and vision for the new company and whom, at least temporarily, is prepared to invest time and effort into the preparation of a sound business development plan and a good marketing and merchandising plan.
After this getting-to-know-you period, it is time to explore make or break conditions, intellectual property agreements and all the legal forms that document what each party brings to the process of becoming more than business partners on journey of discovery.
Only then is it time to tie the knot and work through the elements of new venture formation required for the next few years as co-founders of a start-up enterprises and the way that trials and tribulations of the emergent business are to be dealt with.
It is important to spend enough time together sorting out whether you are working towards a conspiracy to address the realities of business failures or a longer term consolidated effort to confront the requirements of company foundation and consolidation.
There is no doubt that finding a partner represents a combination of all the C words associated with both the dating game and founders’ fantasies: communication, collaboration, creativity, competency, clarity, charisma, capability and, the ultimate biggie, commitment.