In my previous article on the Startup 101 series, I spoke about the problems one will encounter if he/she starts the business alone. In this article I am going to talk about the various issues one should consider when selecting a business partner.

Selecting a business partner is one of the most crucial decisions an entrepreneur will take in the early stages of the startup journey. One can see a parallel between selecting a business partner and selecting a life partner. When it comes to selecting a life partner, people want to make sure that they will have a successful life without much troubles. One should apply the same principles while selecting the business partner too. The success or failure of your business venture depends on your partner as much as it depends on you. So it is very vital to think about various aspects before selecting a business partner.

In an ideal startup, one should have 2-4 founders. In the previous article, I talked about the problems one will face when doing the startup alone. Similarly, there are issues one will face if they have too many partners/co-founders. The more the number, larger are the disagreements between the partners. The difficulty in sorting out the difference in opinion among the partners is directly proportional to the number of partners/co-founders in the startup. When you bring in more people, you are adding diversity to the founding team. This diversity will lead to a wide spectrum of views which might take the focus away from what is needed to carry out your vision. Any unresolved issues in the founding team will lead to groups within the team and an eventual splitting up of the company. Paul Graham, the startup guru, says that the ideal number of people in a startup should be between 2 and 4. My suggestion is also similar to Mr. Graham. You can go over this range only if there is a golden opportunity to add more value to the startup by a potential co-founder/partner.

An ideal partner/co-founder should be someone who shares your vision for the startup but who can also offer an alternative perspective to achieve the goal. Most of the technology startups are done by people with technical background. If you are someone with technical background, you won’t find it very difficult to manage the business side of the startup. In fact, many of the successful tech entrepreneurs are people who only had the technical expertise when they started the company. It is comparatively easier for a technical person to pick up the business side. However, if you think it will be difficult for you to manage the nuts and bolts of business or if you don’t want to manage the nitty gritty details of running a tech startup, it is important that you rope in a partner/co-founder with business background. At least, try to have another technical person who has inclination to deal with customers and other business tasks. A good founding team will have a mixture of technical and business talents.

A good founding team should also have a visionary and an operations person. The visionary is responsible for the long term vision of the company. He/She should be able to plan for the future. The visionary should also be able to readjust the company’s long term strategies based on the evolving technologies and business trends. He sets the vision for the company with inputs from other co-founders. An ideal visionary is a technical person with business acumen. The operations person is one who handles the nuts and bolts of everyday operations (both on the technical side and business side).

With the above ideas about the composition of the founding team, let us now explore how one should go about finding business partners/co-founders. The expectations for the company should be clearly laid out to the partner(s). You should clearly explain your vision and the path you want to take. Check out if the partner can also align himself/herself with your vision. Discuss frankly and deeply about the financial aspects with your potential co-founder/partner. Check out if his/her financial interests aligns with yours. Put everything in a document format and “legalize” it. There should not be any ambiguity on the financial part of the relationship. Check out if you can completely trust your partner/co-founder. Without trust, there is no partnership and there is no point in keeping the person in the founding team. Check out if the co-founder will fight as hard as you for securing a deal or tackling the problems associated with the startup venture.

Om Malik and Michael Copeland have listed the qualities one should look for in a co-founder in their Business 2.0 article. They are

* Loyalty to the business idea
* Honesty, including the ability to acknowledge errors and mistakes
* Versatility to focus on more than one aspect of the company
* Good communication and the ability to attract good talent to the team
* Flexibility in face of changing circumstances

Before I end this article, I want to make a comment on having a friend as the business partner. A good friend need not be a good business partner. Getting along very well with a friend in real life doesn’t translate into a great business partnership. There are many occasions where the friendship is broken due to conflicts that occur on the business side.

When you select your business partner/co-founder, keep aside any personal emotions and determine the pros and cons of a person in a rational way. This is very crucial for the success of your startup.