How To Resolve Co-Founder Conflict

(Note: This post was transcribed and edited from this video)

Hey guys, I want to talk for a few minutes about cofounder friction and what to do if you're in a situation where you started a company with somebody and now it's not feeling sweet and it's not feeling good and there's friction and you don't know what to do.

So I see this a lot with people I work with because a cofounder relationship is a serious, intimate, long-term relationship, and just like any other serious, longterm intimate relationship It doesn't always work out. And in fact it usually doesn't work out. Unfortunately working out is the anomaly and it not working out is more like the norm. And that's a big reason why so many startups fail.  So what do you do?

First of all, pick a cofounder extremely wisely. I always tell people, don't work with someone as a cofounder unless you've already been working with them for a number of years and you already know what it's like to work with them, AND you already know that you have a good flow with them.

My second piece of advice is: choose your cofounder wisely. Even if you have a track record with someone, that doesn't mean they will make a good co-founder. You want to choose somebody who has a different set of skills than you do and is a different kind of person than you are.   

I have personal experience with this. Kati and I were co-founders of Kindara and from the first mockup that we sat down to make of the product, we started disagreeing and we pretty much kept disagreeing all the way through three or four years of working together until finally we decided that she was going to leave the business! And that was not an easy decision by any means, but we essentially decided at one point that if we didn't have her leave the business, we were going to blow up the business and then blow up our marriage. The issue with our partnership is that we're both designers, and both obsessed with the product.

Katie and I are both big idea, big vision type people. We, we really appreciate it and want to put energy in design and product and the creative side of the business. And so having two people in company that had that same skill set was really a recipe for friction. From the beginning. We were stepping on each others toes from day 1. 

I've worked with other co-founders, who between the two of them are very different types of people, you know. One is a visionary type person. The other is a real ops type person. Like one is a person who likes to have big ideas and work on the product. The other is the type of person who likes to be handed a product idea, figure out how to make it, how to engineer it, for example.  Or one person as a salesperson, the other person is an engineer. Those are the cofounder relationships that I see working out the best because there is a line of delineation between what one person is supposed to do and what the other person's supposed to do. 

Which brings up a third point. Once you're in a cofounder relationship, it's super important to decide who's responsible for what. If you're both responsible for the same stuff, that's a recipe for friction. So get a piece of paper, put a line down the middle. Put your name on one side, and your co-founder or co-founders names on the other side, and in each column put who's responsible for what. Figure out an organizational chart and accountability chart and make sure that you're not accountable for the same stuff. That's a good recipe for making a cofounder relationship work. You want to divide and conquer.

However even if you follow the above advice, in many cases a cofounder relationship still doesn't work because there's disagreements about equity, or there's disagreements about the direction of the company, or there's disagreements about the amount of work that each person is putting in, or there's disagreements about the amount of time that aren't getting paid what they are used to getting paid, etc.  

So in many cases there there will be friction. Here's what to do about it: 

Communicate: when there's friction in a relationship, the solution is communication. This has to be something that you put energy towards on a regular, consistent basis. The same way that you would for any other long-term intimate relationship like a marriage. You've got to invest in the relationship, set aside time to communicate, and make sure that that communication is working, meaning each of you are saying what's true for you and being heard by the other person.

If you aren't setting aside time to communicate and get on the same page, it's likely the friction will just get worse, or simmer and blow up later. Hoping the friction will go away is a losing strategy here. So communication is the number one thing that I tell people to focus on in this kind of situation. Often there will be stuff that neither person wants to talk about. For example, I had one company where a one co-founder would get mad and blow up at the other co-founder when stuff would go badly and then they would just ignore it and not talk about it and until it happened again, and then they wouldn't talk about it until it happened again. 

And it kept getting worse and worse. And it's hard stuff to talk about for one person to sit down with the CEO and say "Hey, every time I give you bad news, or every time I tell you that something didn't happen, you blow up and, and say really hurtful things to me. And I don't like it. It hurts my feelings. And I don't want to exist in a work environment where this is happening". That's a hard conversation for some people to have and those are exactly the conversations that you gotta have.

So once you identify friction, the first thing to do is to start communicating. Sometimes it might be helpful to get a mediator to come in and sit in the room with you. You could get an investor, you could get a coach, somebody to sit there, might be necessary to help the conversation go smoothly and you might have to do a number of sessions. But whatever you do it's imperative that you get communication working and flowing so that each person, each part of the partnership feels heard and is able to listen and understand the other person. 

It's just like a marriage or a romantic relationship. You got to get on the same page and restore trust and restore a feeling of "okay, this is working. I trust you" because if you can't get it to the point where it feels smooth, I know from personal and from the experience of working with lots of companies that the amount of energy you'll burn through is immense! Your customers will feel it, your vendors will feel it, your investors will feel it and your employees will feel it. 

If there's constant friction at the top, it's going to slow down the company massively. I know from first hand experience with Kati and I at Kindara. I think  we probably wasted at least a year and a few million dollars because of the constant friction between us. And when Kati left the business we found a new level of growth and success. We raised millions more dollars. We launched the product. 

We took the company from six figures to seven figures and all that happened in large part because the friction that Katie and I were living in and dealing with on a daily basis was gone. And for us it was especially relieving because Kati went from being my cofounder and constant adversary to being my supporter and partner at home (since we're married) 

So the bottom line is this is a longterm intimate relationship. Communication therefore is the number one most important thing.

Succession is the other option. If you can't get the communication right, and you can't get accountabilities set, and no matter how hard you try, the relationship isn't feeling good, then I think it's time for one person to leave the partnership. Just like a bad romantic relationship there's no point staying in a bad one when all efforts at reconciliation have failed.

The thing about succession is it's likely to unlock a ton of energy. It feels traumatic and it can be traumatic. It's like a divorce. It's hard to get out of a bad relationship and it takes a lot of energy to get up the courage to get out of a bad relationship. 

But I've worked with enough people to see that what's on the other side is worth it. It's worth having harmony in your company and harmony at the top, harmony among the leadership team. You really need that kind of harmony to have sustainable growth and success.

So that's my advice to anyone experiencing co-founder friction: invest heavily in communication and see if you can find and fix the root of the friction. Use a mediator (could be a coach, an investor, advisor or therapist) if you need to and set aside time and a process. This might take many sessions over a number of months. If at the end of the process the relationship isn't feeling good and/or a solution hasn't been found I recommend succession. It'll be painful, but the pain is short-term, and I almost guarantee a few months later you'll be happy you tore the band-aid off. 

Hope this was helpful, shoot me any other questions you have.