The first time I had a co-founder things didn't work out, exactly because I felt I was doing a lot more than my co-founder. For instance, once we had the prototype done we started pitching it to clients, but for every 10 clients I pitched the product my co-founder would pitch to 1. I decided to abort the project as I didn't want to do 80% of the work while earning only 50% of the profits. In this case my co-founder was also a developer.
After that experience I had the opportunity to co-found products with other people, but I always backed down for the same reason, I was afraid the other person wouldn't be able to keep up with me, so I would end up doing most of the hard work. This fear gets amplified when the co-founder is not a technical person, which means I'll certainly need to take care of the development aspect myself, while the other person focuses on the business aspects, which in my opinion are much less demanding on software related projects (at least in the early days).
And to be clear, I do know how to manage the business aspects too, so it's not like without a business co-founder I would be lost.
1. Psychological Aspect: How do I overcome this fear?
2. Practical Aspect: How do I structure things with my co-founders so that I don't end up doing most of the hard work?
Kashif, some options:
Option 1: do it yourself. it sounds like you are more than confident in your capabilities to handle both product dev and "the business aspects" yourself. no cofounders, no conflicts. problem solved.
Option 2: work on your people and leadership skills. I have made a living as an engineer, engineering manager, salesman(often mislabeled today as "business development"), sales manager and executive (technical, product, sales , biz dev, and C-suite). Your comment that the "business aspects are much less demanding" indicates that 1) you likely lack sufficient experience with "the business aspects" to know what needs to be done and 2) that you lack leadership experience. Expressing your opinion that the 'business aspects are much less demanding" would certainly demotivate any "business" cofounder. Different aspects of your business will require varying degrees of effort and expertise at various stages of your company's life cycle. If your approach is to build first and sell second then, yes, in the initial stage, product dev can demand more time, but time is not necessarily the input you should be measuring. If it takes you 1,000 man hours to build an MVP and it takes your cofounder 100 hours to close the first significant sale you cannot conclude that s/he added only 10% as much value as you. Put your ego aside. Understand that you may have chosen the wrong partners. That's on you. Don't take our your failings out on the next cofounder. If you previous cofounders were just plain lazy that's on you - you chose the wrong people. Put effort into learning how to evaluate and judge the character of people who may join your team so as to increase the chances of partnering with the right individuals. Consider "pitching to clients" before you build the prototype. good luck.
The answer to both questions is the same: use Slicing Pie as your equity split model.
The reason you have this fear is probably because you used a traditional fixed-split. You may have split the equity "50/50," for instance. This is quite common, but it creates the problem to which you are referring.
In a fixed split, your share of the equity stays fixed regardless of how much time, money, ideas, relationship, facilities, equipment, or supplies you contribute.
If you both contribute exactly the same amounts everything is cool, but this is unlikely. If you do more he will unfairly benefit from your work.
Slicing Pie, on the other hand, splits equity based on your contributions relative to one another and anybody else who contributes.
Think of the startup as a game of Blackjack. Two people agree to split the winnings 50/50. They each bet $1 on the same hand. If they win, it's fair to split the winnings 50/50 because they both bet the same amount. But let's say the dealer deals two aces. One guy is broke so the other guy covers the double-down bet. So, now guy one has $1 on the table and guy two has $3. Clearly, the fair split is now 25/75. In other words, each person's share of the winnings (equity) is based on their share of the bets placed.
Their 50/50 agreement is short-sighted because it depends on them both betting the same amounts and, if they do, they will maintain a 50/50 split, but that rarely happens. Things change.
Startups are the same thing. When you contribute and do not get paid, you are, in effect, "betting" on the future profits or sale price of the company. This is the basis of Slicing Pie. It's the only equity model on the planet that can ensure a fair split.
So, implement Slicing Pie and your hard work will be properly rewarded. If you don't, you are doomed to ongoing conflicts with your partner!
Is your problem the equity, specifically? The solution is simple: everyone vests (or use the model Mike proposes). If your cofounder is not hitting milestones, fire him or her before the first vesting event.
The greater challenge with cofounders, at least the one I've experienced more, is the psychological hit of realizing you're the only one truly invested in this. I don't have an answer to this; I usually just ditched them and finished the project myself, with occasional help from contractors, when this occurred. The drag of a bad cofounder is not worth the aura of having "a team".
We don't know how big the project is, but at some point it's likely you will need someone besides yourself. Maybe as a co-founder, maybe as an employee, maybe as a contractor.
I'm not sure how you overcome the fear of working harder than a co-founder, but maybe you could shift your perspective. If you're not working harder than they are, they might have the same fear about you! Personally, I've always felt most comfortable when I'm the hardest working team member. Or at least felt I was.
For what it's worth, probably because I'm more technical, I feel the business aspects are more demanding. Even in the early days. Even if the technical tasks require more hours to accomplish. There's more predictability getting a compiler to compile than a buyer to buy or an investor to invest.
Being a business guy - with decades of experience - I am a little set off by the statement that the "business aspects, which in my opinion are much less demanding". I also find your background about having done that, yet you have no successes to point to that you know how to actually do it, dismissive. Many software-based companies have hit the ground hard because software guys have discounted the business aspects and what it actually takes to avoid issues that comes with experience. I have also seen companies fail because the business guys think "its just software". Unless your co-founder has exactly your skill sets (which is foolish in any business because of the echo) chamber) do you have any respect for what they do bring now, and in the future? Do you fully grasp strategy? Do well do you get corporate governance? How does the incentive equity get paid? How about contract work? Can you manage lawyers and accounts? hire and lead marketing and sales? Be in more than one place at a time?
It seems you have a bigger issue, that being trust. This is a marriage and, unless you have been married, you do not understand the relationships are never 50/50. They are always 100/100 or you will fail. If you want a 50/50 relationship then you need to hire a person with exactly your skill set, but it will not turn out well.