When you first start a company, you’re usually operating in a “wonderland” environment. Hopes and aspirations are high, but the stakes aren’t real yet. There’s no growth or traction, no revenue, no funding, and more often than not, you haven’t even launched a product yet. While operating in this “wonderland,” most founders won’t feel compelled to map expectations with each other about how to run a company.
Often, I found myself wanting to discuss various topics with my co-founders. How should we go about hiring? How do we intend to spend money when we have it? What kind of culture should our company strive for?
But it felt silly bringing these topics up before we had any traction. We were always slammed in those early days, working nights and weekends, merely trying to build a viable product that users wanted. We didn’t even know how far we could make it; what’s the point of talking about employee option pools when we don’t have any employees?
Well, the truth is, it’s better to have these conversations sooner rather than later. Sure, it may feel a bit silly, like a bunch of grade-schoolers in a rock band, debating which songs they want to release on their first major-label record.
But when individual expectations aren’t reconciled between co-founders, things can go sour when the stakes become real.
For my company, shortly after closing a few deals and raising a seed round, everything changed. My two co-founders and I went from having no money in our company bank account to suddenly quitting our day jobs and having millions of dollars in the bank.
Our personalities seemingly transformed overnight. For instance, I never knew that one of my co-founders was conservative in nature when it came to spending money; he (understandably) prioritized protecting our runway above all else. Whereas I had always been a staunch believer in spending money to save precious time. We had utterly opposite viewpoints about one of the most important aspects of running a business: how to manage its money.
We’ve been working together for years, how did we miss these things about each other? Well, for one, we never bothered to have a conversation about how to spend money because there was no money.
During the first year, post-funding, the three of us had more debates over a variety of business decisions than I’d care to admit. To me, this indicated that I was learning who my co-founders were the following year after we were funded.
The truth is, you and your co-founders don’t become different people after your company begins to experience any measure of success (albeit funding should not be considered a measure of success, but that’s a separate topic for another time). Success and money don’t necessarily change a person - it merely illuminates who a person really is.
The moment that the stakes became real for us, we started looking at the company as a real thing. A thing we had to protect, and we each protected it by imprinting our personal ideals on it. We had to learn a lot about each other in the process.
Luckily, my co-founders and I had a healthy respect for one another. Our discussions never broadened into irreconcilable arguments. It was vital that we each understood that our ultimate desires were identical: to build a successful business.
We always did (and continue to do) our best to see each other’s views objectively. I believe our company is better for it in the end; it helps to have checks and balances against your own potentially-flawed ideals.
Many founders may not experience these issues, mainly if you’ve worked with your co-founder(s) in similar circumstances in the past. Yet it never hurts to map these expectations out earlier nonetheless, even over casual conversations.
In retrospect, my co-founders and I spent too much time trying to understand each other at a time when we should’ve been focused solely on our company’s growth. There was nothing wrong with having these conversations, but their timing could’ve been planned more strategically, e.g., when the stakes were less real, and we didn’t have a ticking time bomb strapped to our bank account in the form of “monthly burn.”
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