Co-Founders: Table for Three Please
“We’ve been friends forever, so it’s the perfect partnership!”
“She’s really technical, and I know the market better than anyone, so we’re going to be unstoppable.”
“We worked together in our last jobs, so we know what we’re in for.”
These are familiar lines that I’ve heard from hopeful clients as they’ve launched their start ups. Whether it’s two people who know each other well, a team with complementary strengths, or people who’ve worked together in previous jobs, these confident refrains enable co-founding teams to dive right in and begin focusing on finding product-market fit, implementing new systems, and getting seed stage funding.
These are all critical elements of starting a business, however, they neglect a foundational part of any organization: the relationship among the leaders who are in pursuit of a shared vision. Time and time again, entrepreneurs with great ideas who are eager to build businesses skip over this essential step.
“We don’t need all that touchy feely stuff.”
“We already agreed that we’d be honest with each other and have those hard conversations, so we’re good to go.”
“We want to invest in our partnership, but we’ll do it once we get more funding.”
I get that. For anyone who has gone to business school or watched enough TED Talks, you’ve likely seen the matrix depicting importance vs. urgency:
The matrix is a quick hit way to determine what to not do, what to have someone else do, what to do later on (at a scheduled time), and what to do right away. And the founder relationship is most often seen as very important, but not as urgent as everything else, and so it gets pushed off and scheduled for a later date.
“Working on our team’s relationship: definitely important. We’re going to dedicate time as soon as we get more funding, find product-market fit, and hire that new engineer.”
This is where I disrespectfully and strongly disagree.
So many of my co-founder clients arrive at coaching because they put their relationship in this important but less urgent quadrant. They put off the hard, uncomfortable, “touchy feely” conversations, and as a result, they find themselves and their relationship at a breaking point.
They made a reservation for two, when the party size was actually three.
When two co-founders come together to form a partnership, each person gets a seat at the table. In addition to those two people (or three or four, depending on how many are part of the co-founding team), there’s always one additional seat that gets an automatic invitation to the party. This seat is called the “Third Entity.”
The third entity, or the collective consciousness, is the unique identity of the relationship. Another way to think about this is while John, Paul, George, and Ringo were individuals, their Third Entity was the Beatles. Michael Jordan, Scottie Pippen, Steve Kerr, Dennis Rodman, Ron Harper are individuals; their Third Entity was the championship Chicago Bulls.
Every partnership is a combination of the individuals and the relationship of this partnership (the third entity). It’s useful to think of this third entity as separate, with its own needs and its own voice; it requires its own seat at the table. The challenge that most co-founders and partnerships run into is that they neglect this third entity, they neglect the relationship, and only focus on the individuals.
Now, imagine being that third wheel, the one who got left out of the dinner reservation. When you arrive on the scene, the others have ordered and there’s not much room or time for you to join in on the party. Founder relationships that neglect the third entity soon find themselves in a bind: each founder has been in their own swim lane, heads down in getting what they think needs to be done, done. But they’ve ignored the relationship, they’ve done things in the way they think is right, they’ve assumed that there’s alignment with their partner(s), but they haven’t done the work to check those assumptions. Suddenly, they wake up and find they are no longer at the same table, and that their relationship has given up on them.
This is when co-founders usually choose to bring in a coach. And sometimes that works, and they can go back and do the work, and they repair what’s been broken or missed along the way. But fair warning, that takes time, effort, and a lot of humility from everyone involved. Sometimes it’s too late, too many bridges have been burned, too many bad habits and patterns have been ingrained. The third entity doesn’t want to be a part of the party anymore.
I heard a beautiful quote from Mark Nepo the other day:
“The doorway to our next step of growth is always behind the urgency of now.”
Going back to our urgency-importance matrix. It’s time to rethink where the “touchy feely” third entity work belongs. I would alter Mark Nepo’s quote for co-founders:
“The doorway to successful, sustainable partnerships is always behind the urgency of now.”
Don’t let the urgency of now fool you into thinking the relationship with your co-founder can wait. Taking the time - more time than you likely want or think you have - to intentionally design your partnership with your co-founder will pay dividends for years to come.
Companies with multiple founders outperform solo founders by 163%, but 65% of startups fail due to conflicts among co-founders. When you choose to set the table for just one more - for your third entity, your relationship - you’re choosing feast over famine.