The Case for the Single Founder Startup

The Case for the Single Founder Startup(readwriteweb.com)

47 points by thorie 14 years ago | 17 comments

alexkearns 14 years ago |

Paul Graham is a great guy but he is now more an investor than an entrepreneur (or at least that is how he functions with Y Combinator). We should therefore realise that when he says that he prefers to invest in companies with more than one founder, he is saying this from the perspective of an investor.

And from the point of view of an investor, it makes a lot of sense to have more than one founder. You invest about the same amount as you would with a single founder business but you get double or more the passionate people working desperately to make the business work.

From the point of view of a founder, however, things are very different. Get in a cofounder and you have immediately halved your stake and possible payout. You have also lost a lot of control. You are no longer in complete control of the company - many decisions now has to vetted by your cofounder. Not necessarily a bad thing but there is something to be said - from a self-actualisation perspective - for having complete responsibility for your destiny.

tribeofone 14 years ago |

The being nimble and touchy relationship stuff is nice, but the real reason you dont need a cofounder is: why split the equity 50/50, 75/25 or whatever it is? You used to need partners to share risk (mainly the infusion of capital). In this industry there are very small barriers to entry, faster returns, and plenty of money available if you have a good idea. Meaning there is very little risk on the part of a entrepreneur.

Why give up a substantial chuck of the equity for a "co-founder" when you can bring that same or similar person aboard 6 months later for a percent or two (5 at most) and get the same results.

patio11 14 years ago | |

Meaning there is very little risk on the part of a entrepreneur.

This line, more than anything else in the last year, is pinging my bubble radar. Ping, ping, ping!

It isn't skydiving without a parachute, but essentially everybody capable of doing a fundable business is also capable of getting a six figure job tomorrow in the current economic environment. If it takes 1.5 to 3 years of your life to discover that the brilliant idea to upend ad distribution through social networks on iPhones was not quite so brilliant, you've very much lost something. (1.5 to 3 years of your life, and, by the way, some money.)

alexkearns 14 years ago | | |

You have probably learnt a lot however. Also, you assume that if someone was not working on their start-up, they would be doing that high paid tech job you refer to. But the reason that many people do a start up is that they could not stand to do that high paid tech job in the first place.

chc 14 years ago | | |

That's a way to look at things that has some value from a decision-making perspective, but it's not the only way. When people talk about there being little risk to opening a business nowadays, they mean there is little risk of an outcome more catastrophic than a little wasted time — the outcome might not necessarily be rosy, but you can keep going and hardly miss a beat. If you forgo that six-figure paycheck for a business that goes belly-up, good news: You're still the kind of person who can get a six-figure job tomorrow.

adthrelfall 14 years ago |

At the very early stage it make perfect sense to just go for it and scratch that itch, but all too easy to then get burnout or bogged down in other aspects of the business. Good advice re mentors. If you're on your own, you do need to have those external sanity checks.

trevelyan 14 years ago |

Too bad readwriteweb doesn't cover them.

bumbledraven 14 years ago |

Would you sign up for the MIT Puzzle Hunt as a team of one? To build a successful startup you will have to complete challenges that are even more diverse and difficult, so why do it alone?

phyllotaxis 14 years ago |

This should be read by anyone with the drive to make their own future. I believe passionately in building strong relationships with as many people you can- but having someone that truly shares your type of drive is rare.

I think this article should be as useful to all you current co-founders, too, as a reminder of the elements to work toward in a genuinely symbiotic partnership.

Excellent advice.

ttalola 14 years ago | |

Having a co-founder is better than going alone, but only if the person shares same values, passion, attitude to work etc. Instead of trying find this person (which is more difficult and takes more time outside the Valley) it's better start working on the idea by yourself while still keeping your eyes open for co-founder/1st employee.

IMorgothI12 14 years ago |

Ycombinator not funding my startup cost them 10 million dollars.

Raphael 14 years ago | |

Your startup exited for 167 million dollars?

dangrossman 14 years ago | |

Is that relevant to this discussion somehow?

rocktronica 14 years ago | |

Cost !== Lost Potential

Troll_Whisperer 14 years ago | | |

What does it mean when a ! is followed by a double equals? Is !== different from != in netspeak?