On Founder-Org Fit
Sharing a quick excerpt from One to Ten based on a conversation from the past few weeks with a founder that was in the midst of figuring out founder-org fit. I’ll be posting more sporadically the rest of the summer due to vacation and, well, it being summertime. :)
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I remember the uncomfortable silence. The squirming in seats. It was a cold winter night and I was presenting at Harvard’s Launch Lab X about lessons learned from twenty years in tech to a room full of young startups. I had just remarked that, more often than not as a startup scales, one of the founders emerges as the clear leader, while their co-founders take other roles or else exit the business. The audience wasn’t expecting to hear this during their honeymoon phase of working together.
And yet, not every founder can scale with the needs of the business. This is not something that new founding teams pay attention to, but it can be the most pernicious organizational debt to tackle. Perhaps the founder was brilliant during the Zero-to-One phase but isn’t interested in scaling beyond that. Technical founders often take on managerial responsibilities and then realize it’s not for them. They’re happier staying as an individual contributor and becoming an expert in their discipline.
These are delicate and often difficult conversations to have. But they must be had, or else painful founder breakups can threaten the value you’ve painstakingly created. Investors can help provoke the conversation but will be reticent to get too involved unless it is becoming toxic to the whole company. No VC today wants to have a reputation for meddling with founding teams and breaking up the band.
So have a regular, honest dialogue with your co-founders and align expectations:
Reestablish the “why” behind your coming together in the first place. Have those reasons changed or is there a different context? Perhaps your co-founder has a family and needs a certain type of income that your startup isn’t able to provide. That happened to one of my startups recently where one founder bought the other one out.
Commit to at least a yearly check-in with each other in which you take stock and discuss roles for the upcoming year. It only works if each person honestly reflects as to whether they’re really the best person to occupy their current role for the next year.
Determine the best role for each founder accordingly. Sometimes it means a transition out of the operations of the business, either to the board or out of the company altogether.
Founder transitions should be driven by the founder themselves. The worst is when the founder doesn’t recognize their limitations or holds on to a role too long. The end result is the same—taking another role or being nudged out of the business. But they could have avoided a lot of angst and stress by being proactive about it. Don’t be that founder.
Selected Other Reading
Efficiency is the Enemy - be sure to have enough slack in your schedule