How to build and structure your founding team?
"You want the right, small team of dedicated people," Mark Huber said. "Don't bring anyone on whose mission doesn't align with yours."
“One of the most important decisions that start-up founders face is to go it alone, or find a co-founder,” said Mark Huber, the Vice President of Business Development for iSustain Inc. He was selected to speak at this month’s Lunch and Learn session at the Anderson Center for Entrepreneurship and Innovation (ACEI) at the University of Tennessee, Knoxville (UTK). Huber also serves as a mentor and coach for students through his role as an Entrepreneur-in-Residence at ACEI.
He shared a bit about his background as a founder. He started his entrepreneurial journey as the co-founder of Recycle Solutions. He helped grow the company from five employees in 2007 to more than 120 employees by 2014. However, for the past 10 years, he and his wife, Dawn Huber, have been running an uber-successful sustainability solutions firm, iSustain (read the previous teknovation.biz article here).
There are some benefits of having a co-founder, Huber told the students in attendance.
- A co-founder helps provide additional perspective;
- they share the financial responsibility, workload, and stress,
- they provide emotional support,
- they can help attract talent,
- and they can help mitigate risk.
However, not all that glitter is gold. Huber shared some very real drawbacks to having co-founders.
- Having a co-founder could diminish your authority;
- it decreases your financial stake in the company;
- it increases your risk for conflict;
- it complicates the decision-making process;
- and it could hurt company culture if the co-founder’s missions aren’t aligned.
Huber told students that co-founders should complement each other’s weaknesses. For example, if one founder is strong in software development, the other should be skilled at sales and marketing. Regardless, Huber said having a founder who is also skilled in sales is a “must.”
“If you, yourself, don’t have sales skills, then I highly recommend bringing someone on board who does,” Huber said. “You are going to need that person who is comfortable vouching for your company, getting the word out there, and landing clients/customers.”
Throughout his long career as a multi-time founder, Huber has seen many co-founding partnerships. He said any more than four founders start to be “too many cooks in the kitchen.” He said the sweet spot is one to four.
“You want the right, small team of dedicated people,” he said. “And don’t bring anyone on whose mission doesn’t align with yours.”
He shared a story about how his grandmother helped raise him. In his late teen years, she provided all she could so he could be successful. Once Huber started his business, he knew it was his mission to “pay it forward,” and he only wanted to partner with someone who shared that desire to give back. In all, he was looking for someone who had complementary technical skills and valued mission-oriented work (his wife was a natural fit).
However, finding the right person is only a small part of the equation. He said maintaining a co-foundership also comes with setting healthy expectations.
- Create a detailed Founder’s agreement ( including business structure, equity breakdown, vesting, decision-making, goals, roles, and resolutions),
- agree on a resolution method for hypotheticals,
- be open and honest in your communication,
- travel together and socialize often to maintain a good personal relationship.
The next Lunch and Learn session through ACEI will be on Tuesday, April 9 . The topic is fundraising: balancing investments, grants, and everything in between. Lia Winter will be the guest speaker.
Register for the next session through this link.
Like what you've read?
Forward to a friend!