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How do I assess joining a start-up as technology co-founder (CTO) with existing co-founders?

I'm trying to assess joining a start-up - part-time as a technology co-founder with 2 existing co-founders. One of them is a CEO (the idea was his brainchild) and the other is a friend of his - who acts as his "coach" and helps with sales.

I'm a bit torn, because I have a lot to bring to the table - technology product development (11+ years), strategy consulting and business acumen. However, I keep getting assessed on only one dimension - coding. There could be potential conflict down the road because the existing founders have known each other and influence each other on strategy and direction.

The question is - if I respect the CEO but not the other partner, will this result in a failed team? I'm leaning towards backing out of the offer and taking on a more advisory role. What have others done when assessing pre-funding start-up teams, especially when one of the late comers brings a LOT to the table in terms of experience and capabilities on the tech. side - but the existing team is not as experienced (other than the CEO)?

Details about startup: Existing B2B prototype suffices, existing clientele + new signup, business is growing nicely. The need is now to build out a proper platform - which can be outsourced.

8 Replies

Sean Greene
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Sean Greene Entrepreneur • Advisor
CEO & Founder, Bambino
Without the full background on the extent of your concerns, it is difficult to truly advise you on this, however it appears that there are red flags in your mind. As such, I would think it ill advised that you continue forward with the venture. The last thing you (or your potential partners) want is to find yourself in an untenable position, which puts the whole venture at risk because you want to pull out later. Investors bet on teams as much as they do concepts, and if they sense any misalignment, they will not make a bet on you. Good luck!
Ajay Swamy
0
0
Ajay Swamy Advisor
Management Consultant, Product Development, Product Management and Strategy across Capital Markets, Publishing and Media
Thank you Sean, my concerns are the following:

1. I won't have any strategic input in the future because the CEO uses the other partner as a sounding board (the other less experienced partner has no prior work experience - he's young, with a masters in psych and advocates a lot about coaching).

2. This directly conflicts with any platform maturity strategy and the CTO role could potentially be minimized to execution only. This is untenable for me.

3. As you can imagine, this could potentially create an environment for conflict and lead to failure.

4. Despite the red flags above, I like the space they're focusing on and see potential, hence still in consideration.

I appreciate the insights. Thank you!






Charles Binnington
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Senior Executive at Cogent Industrial Technologies
I believe that Sean has struck a very fundamental chord in his comments. The reason that investors bet on teams is because with a focused and aligned team almost anything is achievable. Even with an initial concept that may not work, if its close the team can pivot and create a sustainable endeavor. You have to asses the whole picture but assessing the team may be the hardest. What are their values? Why are they in the business? If its just to make money then run. If they are committed and truly believe in their product and the impact that it can have then consider it.
On the other side I will soon be looking for a technical Co Founder. Technical skills aside it is more about the person than the ability to code.
The three team members would be a good model provided each are independent and no one person has too much influence unless it is clearly defined going in. There are a lot of aspects to consider here and it is not an easy decision. Make sure you are informed and go with your gut.
Tim Scott
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Tim Scott Entrepreneur • Advisor
President, Lunaverse Software
Like many marriages, many startups begin in joyous rapture by simply ignoring major differences and buried assumptions. In these startups (or marriages), as soon as the first shots are fired everything starts to fall apart. By facing tough questions and doubts now, you're ahead of the game. Bravo!

You have two options now. First, bail. Second, call for an open discussion with your co-founders to resolve your concerns. The discussion must include all three of you. If they push you into fake agreement, bail; they lack the maturity to be founders at all. Be prepared for them to honestly reject some of your viewpoints. Be prepared to change some of your viewpoints unreservedly. Just know that whatever you sweep under the rug will one day emerge ten times uglier.

One thing to know is that three co-founders is inherently risky, prone to all kinds of triangulation games, which can be toxic.
Ronis Gracie
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Ronis Gracie Entrepreneur
Product Manager at LeadsMarket.com
Create a founder's agreement, that's the first thing.

Secondly, what ever you guys put on the founder's agreement is what could prevent future problems. I'd say based on your concerns, first of all, vesting terms... of course you are joining after them, so their vesting should be a little more favorable at the starting point. Secondly, maybe you can add something that is achievable either through a milestone down the road or something you can think of that makes sense, that would make you have more voting power than the other founder that you don't "like" or think is not bringing that much value. (if the trigger is achieved).

The truth is that if you guys grow, investors will join the board, and they will pretty much solve some of these issues by having voting power, so the decisions won't be manipulated by 2 founders over 1, because there will be other voters.

I'd say go forward, but definitely sit down with them and draw a founder's agreement, and you guys have to be 100% honest with the agreement's terms you think is fair to protect the "company", not each other.
Robert Gordon
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Robert Gordon Entrepreneur • Advisor
Co Founder at OurRecovery "Because No One Can Do it Alone"
First, are you passionate about the product? or is it just something that could be fun to build?

You might want to look at what you said"if I respect the CEO but not the other partner"... you didn't say, "i respect the CEO". He has experience... but is he really someone you really want for a partner?

Agreements are only as good as the intentions andintegrity of the people making them... relying on board members to solve inherent problems... seems to question good sense...

You said you, "technology product development (11+ years), strategy consulting and business acumen"... shouldn't the value be self evident and acknowledged? Are you being courted?

What does a "part time" co-founder even mean? Oh, are you going to be paid for your "part time" "coding"? Are the co-founders being paid? Where are they on the funding runway? who are their investors?

Sorry for being blunt... but this doesn't seem like a difficult decision... at best be an advisor... 2-3 hours a month with options based on your contribution and the stage of the business's funding. Less funding the great your risk for which you should get more.

As a advisor you can still find something you're passionate about... I'm building a Recovery Platform starting with Alcoholics and Drug Addicts who make up, 40 million of us in the US according to the National Institute of Health... ping me I could us an advisor with your experience and talent...
Dina Destreza
0
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Dina Destreza Entrepreneur
Digital Content Manager at Keyideas Infotech
Give equal respect to both of them. Since decision is being taken by just the two members, you should notify them about your presence and your role. After your formal notice, if their decision making is still the same; I would suggest you to leave them and look for some other Founders who are looking for Co-founders. Regards, Dina
David Pariseau
0
0
David Pariseau Entrepreneur
CTO and CoFounder at Particles Plus

You have to think of this as a marriage of sorts. You're going to be spending loads of time working together under often very stressful conditions (which will only exacerbate whatever red flags are currently there). I don't see a successful outcome of this for you regardless of whatever discussions or agreements you put in place.

If you like this space, why not form your own team with like-minded folks and build your own venture? This is so early on that your starting at roughly the same place. As a developer you can probably throw together a quick demo of something to demonstrate an idea and be further ahead than where this other company is now.

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