Learn Startup: Your Most Important Decision as a Founder and Why It will be a Poor One

The most important decision you make as a founder is who you pick for your co-founder(s).

As Mark Suster of GRP Ventures, likes to say, as soon as you pick a partner you’re instantly diluted more than any investment round ever will. You will be working with this person constantly, relentlessly for months. And yet, you will most likely make a poor decision when picking your co-founder.

Not a bad decision, it may in fact turn out to be a pretty good one, but it will most likely be a poor one.

The distinction I’m making is that a bad decision describes the outcome, whereas a poor decision describes the process. A poor decision is made based on the facts at hand, a bad decision is viewed after the facts are laid out. After the fact, when you’re basking in glory and success, you can look back and see that because of the outcome, you made a good decision. However, before you got to that success, you made your decision without enough to go on. You just don’t know enough about your potential co-founder when you make the decision to join together in your adventure.

There’s almost never enough data - and the reason is that you haven’t been through the crucible.

The Crucible

A crucible is a container for heating components to high temperatures. You discover cruicial properties of these components only when the heat is (literally) on. In the same way, we don’t really know the true character of someone until the heat is turned on.

Beck Weather was a survivor of the dreadful 1996 disaster on Mt. Everest which was chronicled in the best seller Into Thin Air. During that disaster, both feats of extreme bravery and examples of shameful cowardice were exhibited.

““Everybody always says that the definition of character is what you do when nobody’s looking. And when we were up there, we didn’t think anybody was looking. And so everybody did pretty much what that there inner person, the real them, the exposed them, would do.” - Beck Weathers

In startups, we can’t really tell what our co-founder is going to be like without going through the crucible with them. And here’s the kicker, the crucible is not just failure and travail, it’s success as well.

In my first startup, I had two other partners. My first partner was a roommate who I met at church. The other partner came through an unsolicited email. It was hard in the beginning, but we worked well together. The partnership seemed to be going well, even through the bumps and bruises of starting out. But when we reached a milestone of closing our first round, one of the partners seemed to kick back and put things on cruise control. We had landed a great office in SoHo, we had staff and departments, we had money in the bank. By all accounts we were on the path to success, but success is just as much a crucible as hard times.

If this is true, then we should make every effort to learn as much as possible about our co-founders before we co-found with them! We should strive to get into business with them, to see how they deal with success and failure before we get into business with them!

Dating Co-Founders

Let’s use the idea of a Learn Startup to date our co-founders before we marry them. A Learn Startup is a lower risk, lower uncertainty venture in a well-understood market that allows you to learn about startups before you start. Using the techniques and philosophy of The Lean Startup movement, we can measure not just how our product does, but how well we get along with our potential co-founders.

Time Constraints

In the shady world of Pickup Artists, there is a concept known as the ”False Time Constraint“ gambit. The idea is that, if you are meeting a stranger and getting to know them better, you can put their mind at ease by saying you will only be there a minute. Of course, for pickup artists, this is facetious because they really want to hit on the girl or guy and they do not actually "need to go in a minute”. For Learn Startups, we can employ a True Time Constraint.

A True Time Constraint, is a meeting you and you co-founder agree to ahead of time in your Learn Startup venture - let’s say in two months time. At the end of two months, you both agree to hold a pivot, persevere or perish meeting. This is your True Time Constraint gambit. Either party can decide at this point to go their separate ways and perish the company. There are no hard feelings, it’s all be agreed to in advance. If you decide to pivot or persevere, you continue working on the Learn Startup and set up another pivot, persevere meeting 2 months down the line.

A few things might happen:

- You may find that this is a viable, fulfilling business and work on it together as a “lifestyle” business.

- You learn that your co-founder is not right for you and take your learnings and go with someone else (or go it alone)

- You might really like each other, feel that you have learned enough to go for your shoot-the-moon idea together

There’s one other potential outcome and that is you both hate each other, but you both want to continue the Learn Startup because it’s a viable business. Which brings us to our next technique:

Unequal partnership

My first job out of college was at a consulting company. We would run these marathon sessions with potential clients in which we rapidly extracted knowledge and expertise from subject matter experts and came to decisions about a potential solution (sounds just like a consultant doesn’t it?).

Before every series of day long meetings, we would have an exercise to decide how to make decisions. We would offer the client group a few choices:

Democracy . Everyone votes on the choices and that is how decisions are made.

. Everyone votes on the choices and that is how decisions are made. Consensus . Everyone comes to a general consensus about the right decision.

. Everyone comes to a general consensus about the right decision. Committee . A small subset of the group makes the call.

. A small subset of the group makes the call. Decision maker. Everyone’s ideas are heard but one person is the decision maker.

Different clients, different groups of people: invariably, all chose the single decision maker. There’s a reason that co-CEO’s don’t work. When times are good, it’s easy to reach consensus. When the times are tough and the crucible is hot, it’s very hard to have even one person make the call, let alone have two people agree. For this reason, I recommend that up front, you decide who is the key decision maker in your Learn Startup. This person gets the majority share of the operation. Write it down, sign it, make two copies. Someone gets 51%, someone gets 49%. Someone decides, the other abides.

Date to Mate

The whole point of the Learn Startup, is to learn about starting up in a less uncertain environment. There’s nothing more uncertain than people. The road to entrepreneurial success is littered with the detritus of broken relationships, ousted co-founders, and tin-pot CEO’s. The more we can learn about who we’re going into the crucible with before we do so - the better off we’ll be when it gets hot.