Welcome to Mentor Mondays! This is the final post in a series of five on cofounder conflict.
“It is in the space between inner and outer world, which is also the space between people–the transitional space–that intimate relationships and creativity occur.” – D.W. Winnicott
In the previous four posts, I told you I was sharing my unique experience as a coach to high growth startups to discuss cofounder conflict. The truth is that what we are talking about applies to anyone in an organization that has to interact with others. It is about how to be human with other humans.
When my partners and I brought our collective experience and training together to form Reboot, we identified an equation, what my partner Jerry Colonna will often refer to as “the bet,” which guides all we do. That equation is Practical Skills + Radical Self-Inquiry + Shared Experiences = Enhanced Leadership + Greater Resiliency. Reboot is a coaching company, yes. But more than that, Reboot exists as a container for us to do our work as humans. We believe that work can be the way we achieve our fullest selves.
As we have walked through these common manifestations of cofounder conflict and solutions or preventative measures for each, we’ve really been moving through this equation.
I began by sharing the practical skill of giving feedback in the context of caring. As we looked at what happens when one founder does not scale, we identified leveling up (practical skill), asking for help (practical skill after realizing you need help through a process of radical self inquiry), and letting go of ego (radical self inquiry) as solutions to the challenge.
The confusion and crisis that will follow from not outlining a strategy for ‘who will decide what’ can be avoided by articulating who will decide what up front and building relationships on trust and respect–values that emerge from a practice of radical self-inquiry.
When one founder becomes the hero and the other feels forgotten, the treatment plan is practical skills: sharing PR & perks and keeping a clearly articulated vision, purpose and commitment. Yet none of this would be possible without the self awareness and vulnerability that comes from a regular practice of self-inquiry.
Reboot’s friend and teacher Parker Palmer speaks often to the incredible power of speaking to our fears and concerns. To bring them out of the shadow. When people share something particularly painful or hard to talk about, Parker will often respond, “Welcome to the Human Race.”
Our motto at Reboot is “Know you are not alone. Join the conversation.” The knowledge that we are not alone in our struggles, in our shadows, is prodigious. Through our work at Reboot, we find that time and time again, when someone is willing to open up and share about the things we don’t talk about, one of the most uttered responses is one of resonance: “Me too!” people will say. Sharing our true, honest selves is how we as a community help each other. By reading, commenting and sharing these blog posts, we know that these conflicts, these challenges of relationship are not unique. It is perfectly normal to be challenged and to at times struggle with relationships. By connecting on these issues, we can help each other.
The question we pose to you is: what you will do with this knowledge? I believe these challenges are an invitation. An invitation to do the work. To dive into our work, our lives, our relationships openly, vulnerably and emerge anew. Then, we become one step closer to the leader, the partner, the human we were born to be.
Welcome to Mentor Mondays! This is the fourth post in a series of five on cofounder conflict.
The fourth source of cofounder conflict is the most heartbreaking because it only arises if everything is going really well and you are getting noticed by the press and outside world for your accomplishments. In this scenario, the cofounders have already successfully navigated through the first few common cofounder conflicts. Both are scaling, both are doing their jobs, and they are both making effective decisions. They have a healthy relationship and things are going really well.
Here’s the problem: The cofounder named CEO does all the interviews, gets all the articles written about them, speaks at conferences and is named to the latest 30 under 30, 40 under 40, etc. The non-CEO cofounder starts to wonder, “If we are equals, decisions are split equally, we are both scaling, and if I’m contributing just as much as the CEO, why are they getting all the interviews? Why doesn’t anyone outside of the tech community know my name?” The non-CEO cofounder feels forgotten and alienated. In response they will often fight for more internal control (see “Who decides what?”), which leads to not scaling (see “The founder that doesn’t scale.”) because they are playing a popularity contest instead of continuing to focus on their roles which is what has already made them successful leaders.
I believe this conflict can sometimes be the worst because it is purely ego. Put simply it is the sentiment of: “You are getting the spotlight and I’m not.” As a coach it’s truly heart-breaking to watch because this conflict often pops up when there are really healthy operational cofounder relationships, and the company is doing really well, but for whatever reason they are just getting unbalanced coverage in the press.
Consider these examples: There are three cofounders of AirBnB, but most people outside of the tech community can only name Brian Chesky. There are two cofounders at Dropbox and most people outside the tech community can only name Drew Houston. This is just the way the media works; they like one hero. It’s rare that there’s more than one. So the hero gets invited to speak at conferences, and gets invited to the CEO summit, they’re invited by the VC to the CEO dinner with the very influential tech visionary.
The non-hero cofounder is working just as hard, and bringing a tremendous amount of value to their company but receives none of the cool benefits of being a founder.
The challenge is only exacerbated by the fact that the CEO is enjoying the notoriety, the special invitations, the award shows. Who wouldn’t? It can be hard for a CEO to give that up.
Sharing Is Caring
To avoid falling into this ego trap, cofounders need to find a healthy split of these perks of success that works for them, just as they found a healthy split in who runs what in their company.
Press and publicity can be addressed by talking to the company’s PR agency and creating guidelines that split one set of topics for one founder and anything on another set of topics go to the other founder. Cofounders can take turns speaking at conferences.
The “hero” can be mindful about sharing sharing acclaim with their cofounder in interviews and at events.
An excellent example of a successful shared leadership is Warby Parker. It is clear that Neil Blumenthal and Dave Gilboa are purposefully sharing responsibilities and public recognition of leadership.
Another example of a company who navigates this well is Lyft. There is a clear distinction between who is CEO, Logan Green, and who is president, John Zimmer, but there is a lot of shared publicity and clearly split responsibility. In their recent billion dollar funding announcement, probably one of the most significant press announcements to-date for the company and when most CEOs would take the spotlight for themselves, it was John Zimmer, the president of Lyft, who did much of the press.
Above All Else: Clear Vision, Purpose and Commitment
Will Smith and Jada Pinkett-Smith have been married for more than 20 years. A few years ago I came across an interview where they were asked: “You two are one of the rare successful Hollywood couples; What’s your secret?” Their answer? “Really at the end of the day, it’s just not quitting.”
In founding companies it’s really the same. If you go in saying, “Separating is not an option. This needs to exist in the world,” you have humility. You realize that your work is bigger than any individual egos. That if it’s doing what it’s really meant to be doing in the world, it could have a profound effect.
You have to care about the company existing in the world more than you care about the whose name is on the latest headline or your title on your LinkedIn page. You just have to say, “I don’t care. This has to exist. We are going to build this.”
Don't let your ego cloud your vision. via @techstars and @khalidhalim Click To Tweet
This is why having clear understanding of vision and purpose when you start the business is so important. If you have both, humility shows up and you can get through almost anything. Don’t let ego cloud that vision.
This is the third post in our series on cofounder conflict by guest blogger, Khalid Halim.
Leadership is about making decisions. Oddly enough, many founders never take the time to discuss who will decide what. This lack of clarity upfront and strategy to decision-making quickly leads cofounders in one of two undesirable directions.
In the first scenario, all decisions are made by all founders. This results in a slow or gridlocked decision-making process. When decisions are finally made, they are often then changed because there is no one clear decision maker — any founder can reopen any decision. Employees and investors quickly get frustrated with the slow decision-making process or the constant changing of decisions.
If there are more than two founders, the situation is only exacerbated by the orders of complexity between the number of founders who have to be aligned for a decision to be made.
The problem is the idea that we have to decide everything together despite the fact that everyone is going to have a different viewpoint.
Consider the differences between a visionary founder and a technical founder. Visionary founders look to the future and imagine how great it’s going to be out there. Technical founders look at today and say, “This whole system is going to crash tomorrow. We have bad code, bugs, and technical debt. We need to fix this now.” One founder is looking at the ground in front of their feet while the the other is looking out at the horizon. When they have a conversation they are looking at two different landscapes. They can’t figure out why they can’t agree on what they’re looking at because both think they are looking at the same thing. That is the paralysis and conflict that happens when we each inherently have different viewpoints but insist that everyone has to agree on everything.
As challenging as different viewpoints can be, these differences in viewpoints are the reason why cofounders often work out better than solo founders.
A diversity of viewpoints is an asset to the company but needs to be accompanied with a framework for who decides what.
In the second scenario, the CEO makes all decisions. This leaves the non-CEO founder feeling disempowered. They will often resort to having hallway conversations undermining the CEO, reversing decisions, or slipping into the background and not scaling. It won’t take long before the CEO says to the cofounder, “Hey, when I look at what the company has accomplished this last year, I don’t see what your contribution has been. I’m wondering if you should keep your title or if we should just have you on the board and hire somebody else in your role.”
Both scenarios are are not desireable.
Decide How We Will Decide
The healthiest companies decide who is best at deciding what. Each cofounder has their own ball to run with. If a decision is made that is totally egregious, there is veto power. Cofounders agree that each cofounder will have 100% of the decisions all of the time in their respective area, but the other cofounder(s) reserve the right to veto if they feel it goes against a core value of the company or steers the company too far from the mission. The veto is to be used very rarely; you should trust your cofounder to make the decision in the domain in which they are an expert.
If cofounders are not able to operate with this level of trust to let the person hold all the decisions for the domain for which they are responsible for dysfunction usually follows.
The healthiest way to approach decision-making is to split the domains. The most popular split is internal-external. One person in charge of people operations, finance, legal and anything that is internal to the company. The other person is external — fundraising, engineering and product, anything customer-facing. There are other functional models that work as well.
The important thing is to decide who is responsible for which functional areas and to stick to that decision and respect each other’s domain of responsibility.
Like each of the conflicts we will discuss in this series healthy conflict fundamentally comes down to two things, trust and respect. Trust that your cofounder can make decisions and be honest with you when things are not going well. Respect your cofounder enough give them honest and open feedback as things start to not feel right. Trust and respect has to start at the very beginning with the very first conversations about starting the company including who will be CEO, who decides what, and other key conversations that we will cover in future posts.
The key to having and being fully present in these conversations is not being afraid of who you are today and who you are in the process of becoming through the struggle and joy of startup life.
“The key to warriorship and the ultimate definition of bravery is not being afraid of who you are. Examine your experience to see what it contains that is of value in helping yourself and others. Warriorship is the opposite of selfishness. We become selfish when we are afraid of ourselves and afraid of the seeming threats the world presents. We want to build a little nest, a cocoon, to protect ourselves. But we can be much more brave than that. Even in the face of great problems, we can be heroic and kind at the same time.” -Trungpa Rinpoche
Khalid Halim is a certified professional coach and founder of Reboot.io. He works with founders and leadership teams looking to move through change and growth purposefully. Khalid has over ten years of experience working in startups, both as a founder and turnaround CEO.
This is the second post in a series of five. View the first post here.
The most common manifestation of co-founder conflict is what happens when one co-founder doesn’t scale. This conflict is often recognizable by one founder’s comments to the other that “I work harder than you,” or “I don’t know what you do anymore.”
Let’s start at the beginning. When two co-founders come together and decide to found a company the first question is always: Who’s going to be CEO?” Eventually someone has to be CEO. Depending on how the company grows from there, you have differences in scaling.
By definition, the goal of most venture backed startups is to scale. Scaling well is not easy. When you have rapid growth, it’s really hard to grow your skill set at the same pace.
I often find the CEO will scale faster than the non-CEO; the built-in requirements of the CEO position forces a growth that may not come otherwise: she has to pitch, do board meetings, etc. There are these things she must learn. It’s really trial by fire. Scaling is not optional.
The non-CEO founder (who may or may not go on the pitch meetings for raises, may be there for board meetings but not put the deck together) is responsible for certain things but not the company as a whole in the same way the CEO is. This co-founder usually goes on to lead a specific team or business function. While there are pre-built-in mechanisms that force the CEO to scale, it is not inherent that the non-CEO will scale or manage a group of people effectively.
If the non-CEO co-founder is not scaling and founders have done their job well and hired talented and driven people, the CEO will start to hear from team members who are upset with the leadership. These team members will come to the CEO saying things like, “This person doesn’t know what they’re doing,” or “I don’t think I can work here if they keep interfering/micromanaging/second guessing.” If nothing changes these key hires will start resigning–a huge red flag to the CEO and the board. While it is natural for the first generation of leaders to eventually move on, what Fred Wilson calls “Turning the Team,” The resignation of later stage and often more experienced hires is frequently one of the first sign of failing.
The CEO who is scaling will try to save employees from leaving or repair the team(s) that are dysfunctional under the leadership of the other co-founder. This just snowballs the conflict because now it looks like the scaling CEO-founder is undermining the non-scaling founder. It won’t be long before the non-scaling founder comes out swinging, saying “Hey, you are telling my direct reports what to do and now they don’t respect me anymore.” It just crumbles into all kinds of other dysfunction. The scaling CEO has come from an earnest desire to help but has now created more conflict.
What’s a Co-Founder to do?
“We can’t solve problems by using the same kind of thinking we used when we created them.” – Einstein
I like the word “level” because one of the ways to deal with conflict is to move up one level above the current conflict to an outcome you both care about. At some moment both you and your co-founder cared deeply about the success of the business, what was best for the business and how to get it off the ground.
When you are in a place of conflict, it’s probably a place of personal conflict. All sorts of voices in your head start telling you things: “You are not scaling. You are not leading. People are leaving your organization. You are not delivering.”
To heal, you need to bump out of the “You” and into the “We.”
“What do we want for the people that work for us? What do we want for our investors? What do we want for the company?” From there you can work your way into asking, “Is this working?,” “Is this the best thing?” It is hard for anyone’s ego to to say, “I am building something great and I no longer can be a part of it in a leadership function.”
The inverse of the non-CEO not scaling is the CEO who does not scale. While not as common it is not infrequent either. It is just far less likely that they will be fired or removed from the company. You may be asking, “Why don’t founding CEOs get fired? The truth is that the thing all founders have that no outside hire will ever have in the same way is the vision for the company, and the passion and drive to make that vision a reality. The founder is the one who saw something in the world and said, “I need to create this.” They have been thinking about it deeper and longer than anyone else. You just can’t get that from an outside hire. That’s why when CEOs struggle to scale, they’ll sometimes hire a great executive in a senior role, or a seasoned coach, to guide them for a time. That’s one of the reasons why the Google guys hired Eric Schmidt, and Zuckerberg hired Sheryl Sandberg. This happens all the time, but the vision is always the vision of the founder.
Healthy co-founders ask what’s best for the business, what kind of company are we trying to build, what kind of experience do we want to have. What kind of company would we want to work for?
Ask for Help
It’s a willingness to ask for help and it’s a willingness to allow somebody else to lead in a little while, while you catch up.
It’s here I love to bring to mind Larry and Sergei at Google. When Google was scaling rapidly they recognized they had a lot to learn and brought Eric Schmidt. They allowed an experienced CEO to come in for a little while, used that time to scale themselves and then took the reins back. It’s okay to take a pause and let somebody show you how to scale.
A lot of people will say, no, we only believe in founding CEOs –and yes, there is a lot of data that supports that. Absolutely.–there is also a moment where you have to ask yourself, what do I want for my company and how will I best grow? I don’t believe that one size fits all, but there is the right choice for you and your company and it is worth taking the time to figure that out.
Let Go of Your Ego
These situations always stem from ego. As I stated before, this rapid scaling is hard, if not next to impossible to match with your skill set. Where founders get into trouble is when they put their ego and their desire to have a certain title, or be perceived in a certain way by the world, ahead of what the investors are backing and what the employees signed up for. You need to be willing to put the business first and be open to the fact that mean asking for help, or acknowledging that maybe you can best serve the business in a different role.
What is most important is you allow yourself the space to reflect on what you really want, what your motivations are, why you decided that this company had to exist and you had to be the one to build it. Make your unconscious motivations conscious and then decide what is right.
“Until you make the unconscious conscious, it will direct your life and you will call it fate.” -Carl Jung
Welcome to our new series, Mentor Mondays, where we feature expert advice and guidance for startups from Techstars mentors and industry leaders. Today we welcome Khalid Halim, certified professional coach and founder of Reboot.io. Khalid is known for his insight and empathy, as well as his ability to transform complicated story webs into simple strings of actionable steps. He works with founders and leadership teams looking to move through change and growth purposefully. Khalid has over ten years of experience working in startups, both as a founder and turnaround CEO.
In 2012, Harvard Business School professor Noam Wasserman studied 10,000 founders for his book “The Founder’s Dilemma.
His research found that 65% of startups fail as a result of cofounder conflict. That’s higher than the divorce rate.
I have founded companies. I spent years working as a turnaround CEO. I have experienced toxic conflict and healthy conflict in organizations first hand. Today, I am a coach to high growth venture backed startups. Each week I meet with co-founding teams who are struggling. Who are in pain. My first request of new cofounder clients is, “Tell me where it hurts.”
If you are reading this and nodding your head in agreement because this relates to your own experience, please understand that you are not alone. My calendar is full clients that are experiencing the pains and struggles that are common in co-founding teams.
There are patterns to this pain. Over a series of five posts, I’ll be sharing the three most common manifestations of cofounder conflict I see in my office, along with preventative maintenance tactics cofounders can employ in their relationships to avoid becoming another tally in that cofounder failure statistic. But before we dive into specifics, I want to talk about conflict in cofounder relationships in broader terms.
Having conflict in your cofounder relationship is normal. Having a conflict is not a sign of failure. In fact, not having conflict can be a sign of a bigger problem.
Lack of conflict tells me one of two things, either you don’t think your cofounder can handle open and honest feedback or you think the relationship is already so fragile that you are walking on eggshells. Either way there is a fundamental rift in the relationship that if not addressed will likely lead to the even deeper conflict. It is how you deal with conflict that makes the difference.
My partner, Jerry Colonna, asks leaders to be fierce, not ferocious. What does that mean?
It means that one of the most compassionate things you can do for a human being is to tell them when you observe that they are not succeeding in a role. We often think that we need to be nice we need to be kind and not hurt anyone’s feelings, but that is actually one of the most violent, least compassionate things you do for somebody because we are not allowing them to fail and then learn and grow from that failure. You’re watching them fail. Then the next thing is they will get fired, they will leave, something will happen. The relationship will break. They will be left wondering how you could sit there and watch them fail and not say anything.
By being really nice things go really, really wrong and then we wonder what happened. That is what the absence of conflict looks like.
Imagine watching your cofounder (or substitute co-worker, direct report, etc.) struggle in a role and hearing about it via feedback from employees or the board and not sharing that feedback with your cofounder until enough time has gone by that you have to fire them or you will either lose a valuable employee or lose the trust of the board. So you finally give your cofounder the feedback and in their mind they are thinking “you have watched me fail for months and have been talking about it to the board and/or employees for months but not telling me.” At this moment a large portion of the trust that may have existed between cofounders is lost. This is the same trust that is necessary to repair the relationship.
Healthy conflict is always given in the context of caring. One of my often repeated prescriptions to cofounders is that their new favorite word is the word is “because.” Because when you are going to give feedback, you are going to give context. That context is going to be something like, “Because you are an amazing CTO, and I think you can be an amazing people leader, I want to give you some feedback.” Then you give the feedback. Without context our brains will always make the worst meaning possible about any feedback. Our survival wiring is setup to see threat before reward.
Understanding the detrimental effects conflict can have on a cofounder relationship and their company, you face a choice. Will you choose to navigate conflict mindfully? Will you choose to invest in building trust, in building a solid relationship with your cofounder(s)? This post is the first in a series on cofounder conflict for Techstars. Next, we’ll go into more detail around the three most common cofounder conflicts I usually encounter in my coaching work with clients, along with strategies to move through that conflict, or better still, prevent it in the first place. I’ll leave you with one Reboot’s favorite quotes around conflict from the author David Richo,
“To be adult in relationship is not to be conflict-free. It is to resolve conflicts mindfully.”
I invite any cofounders struggling with their relationship or looking to solidify their foundation to take the Co-Founder Reboot; a five day, free course from the Reboot team.