Thursday, February 25, 2010

CTO Founders / Cofounders

I just got done reading a post by Roger Ehrenberg Advice for CTO Founders: Don't Let Business Kill the Business where he suggests that CTO Founders should not move too early in finding a business cofounder:

Too often, however, I have found CTO / Founders paired with business people who not only don't add value, but frequently detract from the value of the business. And from my perspective as an engaged seed stage venture investor, this makes them unfundable. This is not only sad but incredibly frustrating, because it is so easy to see how a great technology can be developed and commercialized if only - if only the CTO hadn't been impulsive and insecure and brought on a business partner too early in the game.

So why do inexperienced (as entrepreneurs), ultra-skilled CTOs fall into the trap of engaging a business partner too early? Fear? Lack of confidence? Camaraderie? Perhaps all of the above.

Knowing a lot of CTO founders, I can tell you that Roger is fairly accurate in his assessment of the desire of CTOs to find the right cofounder to be the business side.  And it’s not just inexperienced CTOs.  And I would add to his list that part of it might be time available to help product definition, pursue market opportunities, early sales, raise funds, etc.

Mark Suster has similar advice in Hiring at a Startup? Know Thy Weaknesses is:

I recommend that you start a company by yourself and own 100% of it.  Once it’s set up I recommend bringing in a co-founder and giving them 10-30% of the company depending upon when you bring them in.  I advocate treating them like a co-founder in every way except when they join and how much equity they get.

Mark Suster defines founder vs. cofounder a bit more in Most Common Early Start-up Mistakes.

It’s interesting to read this as it seems to go against a bit of what you read out there such as Venture Hacks - How to pick a co-founder and TechCrunch - Finding Your Co-Founders.  I wonder if this is a shift?

I’m not sure that the good, rational reasons for waiting on finding cofounders is going to overcome the emotions of wanting a cofounder.

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