Business success requires a range of skills and talents and it often makes sense to have a business partner rather than going solo. Iconic companies that have achieved phenomenal success include Microsoft, Apple, Google and Intel — every one of these companies had a couple of founders. Netflix now has two CEOs reflecting the key contribution of both.
There are several things that determine startup success such as having the right product market fit, having a product that the market needs, having the right team and having enough cash.
Once everything is in place, investing in a few online startup tools makes eminent sense as these tools help you in a variety of ways including marketing and customer service. These online tools are force multipliers and help you be more productive by automating tasks among other crucial benefits.
Having multiple co-founders can lead to personality clashes. Should business partners also share a close personal relationship? Perhaps that’ll make it difficult to have the difficult conversations that may be necessary in the course of running a business.
Ideally, business partners should be just that — business partners.
What qualities to look for when choosing such a business partner?
Here are five things that are more important than others.
1. Integrity & Trustworthiness
Trust builds up over time.
If you have known someone for a reasonably long time and have worked together, then you know whether you can trust that person.
If you have such a person in mind when deciding to start a business, you can get into discussions about how to apportion responsibilities.
When you trust someone implicitly, there won’t be scope for second guessing and things will remain smooth. When there is trust between business partners, each partner is empowered to take risky but important and strategic business decisions quickly.
It was a risk for Netflix to bid a large amount for House of Cards but their content head was empowered to take that risk. Since you will be dealing with millions of dollars, trust and integrity are key requirements.
2. Values & Vision
If it comes to choosing between the journey and the destination, it’s best if you both enjoy the journey and reach the destination you have in mind.
Values are often an intangible set of beliefs and outlook as well as an attitude towards life.
These are often embedded in the company’s mission statement.
When business partners share a common set of values, they will be able to make tough decisions quickly. These values may encompass both the good and the bad such as what attitude to adopt towards climate change or the use of fossil fuels.
Some companies stand out via their unique values where they go above and beyond the business requirements in terms of their commitment to climate issues or in taking care of their employees or in giving back to society.
A common vision for the business is a strong foundation for the company. Business partners should obviously align in terms of what their business for the company is. This vision is also often a part of the mission statement of the company. Holding fast to your vision will require both partners to work out the details of that vision such as translating the vision into an action plan or set of actions.
A vision can be made sufficiently malleable so that it can change while remaining true to its core. Companies such as Microsoft and Apple have certainly undergone major transformations over four decades.
Google has grown beyond its core mission. Dell has found a way to evolve and grow as computer hardware became commoditized. IBM has lasted a century and hardware now makes up barely 10% of its turnover.
Netflix started with video rentals and is doing something entirely different now as a major player in producing original content. Having such flexible vision increases the likelihood of long-term success. Having shared values & vision also means you have thought about an exit strategy for your business. New businesses are meant to take risks and often things don’t pan out.
Many businesses go through tough times including now iconic names such as SpaceX.
Many businesses can hit headwinds despite having viable business models and growing revenue streams and not just having crossed the bare threshold of “product market fit.” (Source: Harvard Business Review)
Clearly, the roles of the founders change as the company scales up. The founders may need to make their roles in the company more specific and the company itself may need to make a pivot or pivots in its strategy.
There may be scope to expand into new businesses which may necessitate making some key strategic decisions and hard decisions. Being on the same page as your business partner in terms of vision & values ensures that you will be able to take these and many other crucial decisions about appropriately building a hierarchy in the company or about how fast to grow or which successful company to emulate.
(Hint: the right answer often is ‘not Amazon.’ Not every company can be Amazon.)
3. The Right Skill Set
Business partners need complementary skill sets. To set up a tech-heavy company, at least one of the partners needs to be proficient in tech — like Elon Musk Bill Gates or Steve Wozniak or Brin/Page of Google.
But that’s not the whole story.
Founders need leadership qualities to grow the company. They need exceptional people skills as they’ll be interacting with investors/VCs, employees and others.
Steve Jobs talked about the training in calligraphy he received at Reed College and how it was ‘artistically subtle in a way that science can’t capture.'(Source: Stanford)
It’s often a grounding in the ‘humanities’ that makes a great founder. Some such founders include Reef Hoffman of LinkedIn and Peter Thiel of PayPal.
Scott Hartley mentions the story of Katelyn Gleason who went from being a theater arts major at Long Island’s SUNY Stony Brook University to founding Eligible, a healthcare technology business, when she was 26 years old.
Hartley writes in his book The Fuzzy and the Techie:
“Being CEO of a company is just the latest way Katelyn is under the spotlight, on center stage. She is a fuzzy who joined with techies to solve a problem long overdue for fixing, and she relishes knowing that her company helps process over 10 million health insurance eligibility claims per month, bringing efficiency and savings to an industry ripe for improvement.
Katelyn could never have anticipated how her undergraduate experience would prove so valuable in teaching her to dig in and learn what she needed to know about the technology to build her company, or how transferable the skills she had learned about being a confident, highly persuasive communicator would be to entrepreneurship. Rather than be a poster child for the impracticality of getting a liberal arts degree, she became a representative of how applicable the fuzzy skills developed by the liberal arts are as well as how important they are as complements to technological expertise. Many other successful founders and innovative technology-driven businesses also credit their liberal arts education with preparing them for pioneering new ways of harnessing the power of technology.”(source: The Fuzzie and the Techie)
It is no longer just engineers who dominate our technology leadership, because it is no longer the case that computers are so mysterious that only engineers can understand what they are capable of.
There is an industry-wide shift toward more ‘product thinking’ in leadership — leaders who understand the social and cultural contexts in which our technologies are deployed,” Damon Horowitz says in Hartley’s book.
Hoffman, the founder of LinkedIn and Stewart Butterfield, the founder of Slack, are both graduates/post-graduates in philosophy.
Alex Karp, co-founder of Palantir, Ben Silberman, founder of Pinterest, Carly Fionrina of HP and YouTube’s Susan Wojcicki are others with a humanities grounding.
Life is not a straight path. So, we have to be flexible and adaptable to changing circumstances, to paraphrase Georgia Nugent in Fast Company, as quoted in Hartley’s book.
4. Positive Attitude, Resilience & Work Ethic.
Call it passion or call it positive attitude but it’s needed in startups.
There will be many setbacks no matter what your company has set out to do or achieve. When your back is against the wall, you need a business partner with a ‘can do’ spirit who’ll take it as a challenge and work on finding solutions.
You need business partners who have plenty of fortitude and resilience. These are the folks who’ll be able to weather the storms well.
Work ethic is something which is almost a basic part of human nature. It varies from person to person and people develop their work ethic over a lifetime.
It cannot be taught or learned in a short span of time nor can people’s work ethic be influenced in a short duration of time. So, as you research your potential business partner, you have to find a way to learn about the partner’s work ethic.
You will know about such aspects of a person’s personality automatically when you know a person for a reasonably long time.
5. Character & commitment.
Character is a sum total of several different things: it’s about a person’s appetite for risk taking and also about how honest or trustworthy a person is. Commitment is a part of character as well. Your business partner should be committed to your business as also to your business practices and ethical values and principles.
These are fuzzy personality traits that reveal themselves over a period of time. So, if you have known a potential business partner for a certain amount of time, such as a few years, you’ll know whether you gel well with this person in terms of character & commitment or not.
Complementary set of skills is often a key to startup success.
Great leaders delegate and give credit. People like Reed Hastings of Netflix talk about how leaders in Netflix are authorized to take major decisions independently without needing a lot of oversight.
Old and established companies such as Microsoft and IBM have to pretend to be like startups when they want to do something new such as with IBM’s Watson or Microsoft’s Bing search engine.
Tversky & Kahneman collaborated so closely that they couldn’t decide who should get first authorship credit of their joint papers. So, they decided to alternate between Tversky and Kahneman as the lead authors on their joint papers. Business partners need to be as close as two academics authoring academic papers.
Businesses are like team sports where everybody needs to perform at their best for the company to excel.
If you are looking to build a great company, the first step is to find a business partner who’ll bring ideas and energy to the table and complement your skills.
A business partner needs to be brutally honest when the occasion calls for it. Sugarcoating the truth may hurt the business. Both Amos Tversky and Steve Jobs were known to be brutal truth tellers in their different fields.
Once you find someone who makes the cut on the qualities and criteria listed above, you can be sure that you have found the right business partner.
About the Author
Jasmeet is a founder of Lessons at Startup – A blog where he shares entrepreneurial stories. He specialises in Digital Marketing and Content Writing. He is addicted to Google News, Netflix, Good Coffee and Quora ☺.