Building Great Founding Teams

Excerpt from an insightful Steve Blank blog post on July 29, 2013

There’s been a lot written about the individual characteristics of what makes a great founder, but a lot less about what makes a great founding team and how that’s different from a great founding CEO.

We’ve been imprecise in defining three different roles. In doing so we’ve failed to help founders understand what it takes to build a great founding team.

1.    Founder, Founding team, Founding CEO all have word “founder” in them but have different roles. Founder has the initial idea. May or may not be on the founding team or have a leadership role

2.    Founding team – complementary skills – builds the company

3.    Founding CEO – comfort in chaos, true believer in the project and the ability to pass that on to others – leads the company

Founding Team – the rock on which to build the company
The founding team includes the founder and a few other co-founders with complementary skills to the founder. This is the group who will build the company. Its goal is to take the original idea and search for a repeatable and scalable business model- first by finding product/market fit, then by testing all the parts of the business model (pricing, channel, acquisition/activation, partners, costs, etc.)

In web/mobile startups the canonical view is the founding team consists of a hacker, a hustler, and a designer. In other domains, the skill sets differ, but the key idea is that you want a team with complementary skills.

There’s no magic number about the “right” number of founders for a founding team, but two to four seems to be the sweet spot. One of the biggest mistakes in assembling a founding team is not thinking through the need for skills but instead settling for who’s around. The two tests of whether someone belongs on a founding team are: “Do we have a company without them?” and, “Can we find someone else just like them?” If both answers are no, you’ve identified a co-founder. If any of the answers are “Yes,” then hire them a bit later as an early employee.

Key attributes of an entrepreneur on a founding team are passion, determination, resilience, tenacity, agility and curiosity. It helps if the team has had a history of working together, but what is essential is mutual respect. And what is critical is trust. You need to be able to trust your co-founders to perform, to do what they say they will, and to have your back.

Most startups that fail over team issues fail because co-founders hadn’t dated first, (spent time together in a Startup Weekend, worked together in an incubator, etc.) but instead jumped into bed to start a company.

Everyone has ideas. It’s the courage, passion and tenacity of the founding team that turn ideas into businesses.