Startups · Finding cofounders

A meeting with potential co-founder (business) is coming. How to be prepared?

Nataliya Starostina Product Marketing Manager consultant

April 29th, 2016

I have a meeting scheduled with a potential co-founder/partner. He says he can bring his business acumen, connections and experiences ( three co-founded start-ups). He sounds serious and seem credible. He wants to discuss legal structure, business plan and rather confident on technical side, even though he haven't seen my technical proposal. We are talking very early funding and founding stage. I have to add he has advanced technical degree and MBA.

On my side, i have technical plan to develop prototype, business plan and industry connections, including potential feasibility proof (tba next month). I did a lot of leg-work trying to bring funding in, a lot of feedback, little funds. This is not a software project. It's all about nano-measurements. I am very passionate about it.

What do you suggest me to look out for? concerns? questions? expectations?

your insights are welcome,
Nataliya
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Andrew Lockley

April 29th, 2016

Go and have a beer and see if you get on. It's more important than anything else. A

Anonymous

April 29th, 2016

Think of this as a date. Team risk is probably the highest risk factor in a new venture: you'll need to share a lot with this person in the years to come. Get the sense that you can trust him above all. And fail fast: if he doesn't seem right, he probably isn't.  (For you, that is.)

Michael Leeds CEO & Founder

April 29th, 2016

I would keep it very simple at this point with an agenda of determining whether he can add value to the team and whether you would want to work with him. Tell him what you are up to, why you are passionate about it, and the areas where you need help. Ask him to tell you about what he likes, what he's good at, and what he thinks he can bring to THIS venture at this stage. I think you will learn more from this than anything you will learn from a comparison of degrees. --ml ---------- ​Automating Video Creation @ http://www.r3lish.com/

Ema Chuku Designer. Product Developer. Founder @ NuPad

April 29th, 2016

Not sure what his college credentials has to do with his natural ability to make a good partner. That said, keep it natural and talk about life stuff.. Business topics later. If you are going to have a cofounder better be someone you can connect with on personal terms, not just on paper terms..

Like @Andrew said, go have a beer. Save the excitement for later.

Mike Moyer

April 29th, 2016

Beware of valuations and fixed-splits!

Valuations at this stage are futile. They wild guesses about the future that will never be true (you'll either fall short or surpass your expectations).

Similarly, a fixed equity split will set you up for future problems. A fixed split is when chunks of equity are doled out at the outset of the venture. For instance, he might propose a 50/50 split. This is fine when nothing has happened, but what if you do all the work? What if you want to bring in another partner? What if he expects you to pony up the cash? What if you do pony up the cash and you spend it all?

Every time something changes, you will have to go through a painful renegotiation of your split.

Use the Slicing Pie model instead. The Slicing Pie model ensures that each person's % ownership of the equity is equal to that person's % of the risk taken.

Slicing Pie is a dynamic model that guarantees each participant has exactly what they deserve. 

I've written a book about how it works. Contact me through SlicingPie.com and I'll send you a copy. Read it before your meeting!

Ken Anderson Director, Entrepreneurial and Small Business Development, Delaware Economic Development Office

April 29th, 2016

Treat this like a blind date set up by your over zealous girlfriend and she has promised never to do it again without your permission.

Keep it light, make no irrevocable commitments, and trust your God given instincts.

Is this person who he says he is and can you easily verify it. Use referrals but don't rely on them. Do your own due diligence.

Is this someone to whom you will be connected to the hip doing one of the hardest things you have ever done in your life?

Bill Johnson CEO at Basin Energy Group

April 29th, 2016

Don't jump into any agreements until you are satisfied that you are compatible. Make sure you have him sign a non disclosure agreement before sharing detailed technical information.

Judith Hurwitz President & CEO Hurwitz & Associates

April 30th, 2016

I think that you need to do a lot more due diligence before getting involved with someone you don't know. Who is this person? What is his track record? What do others say about him? You probably need to trust yourself a bit more and move your project further along. Set up an advisory board of people you can trust. You need to own your project and your idea before you move quickly with a partner who may or may not be trustworthy.

Rob Enderle Owner, Enderle Group

April 29th, 2016

There are a lot of scams out there and what red flagged for me is "he hasn't seen the technical proposal yet".  All of the rest tends to come after whether he even likes the concept.  For instance how do you get into a business plan until he understands the product?   Like Igor said, this is a first date, play it like that, don't jump to the marriage on the first date. 

You'll want to take a hard look at the other startups, red flag if he wants money up front, and be really sure of his credentials.   Good luck!

Rob G

April 29th, 2016

Nataliya, hopefully you are seeing a pattern here.  This stage (as many meetings as it takes) is to get to know each other until you are comfortable.  Treat this as much or more about you evaluating him and his experience than him evaluating your potential product or business. resist the temptation to make the discussion about your idea/product.  that will come later. Ask him about his experience - not degrees or plans, but what he has actually achieved for whom and how.  When the time comes to talk about the product, i personally would execute a mutual NDA prior to getting into details, but that's just me.