What does it take to build a successful company? And how important is team culture in the process?
We asked Tillmann Lang, co-founder of Yova Impact Investing, for a list of tips based on his experience.
Here is what he shared with us during the last LikeMinded event.
7 LESSONS LEARNED ON CO-FOUNDING BY TILLMANN LANG
1. Co-founders matter... a lot!
Disagreements between co-founders are a major reason why startups fail. You will spend a lot of time with your co-founder. And you’ll share more with them than only time. Building your founding team is one of the most important decisions in the history of your startup. Appreciate this!
2. Prioritize people before the product - you’ll be spending your life together
The people you work with are much more important than the product you’re building. For one simple reason: your life is happening right now – and you’re co-founder will be a big part of it.
This may sound very generic as this can apply to any co-worker. But the difference is: you get to choose your co-founders. Don’t spend your life with people that don’t lift you up. Spend it with people that you like being around and that make you be your best and feel whole. You want to be able to look back in life and find that your time was spent worthwhile. If you spend it with good people, this will almost always be the case. If you don’t, it hardly ever is.
If you have to choose between ‘great idea’ or ‘great team’, choose the team. You’ll make a mediocre idea shine with a great team. And even if you don’t, at least you’ll have had a worthwhile time.
3. Start with why - beyond the golden circle
As a general tip, take a look at Simon Sinek's Golden Circle. Use it not only for your company, but also for your founding team. With your (potential) co-founders try to understand what motivates each of you to build this company. Why are you here? Do you have a great vision? Do you want to be your own boss? Is it what you expect of yourself? Do you want to get rich quickly? These are very important questions.
If you share a strong why with your co-founders, your why will carry you through crisis. Imagine one of you is led by a vision while someone else is motivated by a successful exit. These 2 people will react very differently to external pressures and stress in the startup. (And there will be plenty of both.)
Among the Yova founders, we have a routine to identify our Whys, which we call the 3 whys of purpose. Each of us has to talk 2 minutes about “Why are you really here right now”. Then the next one. Then we all do it again. And again. Until we’ve all gone 3 times. You’ll be amazed by how many layers of why you will find even for yourself! It is really unveiling and builds a strong bond.
At Yova, the why came first, then the product followed. We are really inspired by the idea of creating a more sustainable future through entrepreneurship and bounced many ideas to achieve this. Impact investing just ended up as the best way to fulfil this purpose.
4. An equity split will never seem fair to everyone always...so get over yourself and move on!
Splitting equity is one of the hardest tasks in founding the company. For a simple reason: An equity split will never seem fair to everyone always.
On day 1 you don’t really know anything about your startup yet. What seems fair today will not always feel fair.
You cannot change that. So get over yourself and move on. Don’t go for a perfectly fair split. Agree on a split that is likely to keep everyone motivated in the long run. Remind yourself that your co-founders want your best (if they don’t, you’re screwed anyway). So make a deal that you can live with in many scenarios. And when the day comes that you feel like you’ve come up short: remind yourself that it’s the size of the pie, not your slice, that matters – also for you.
But as with anything: If a very bad feeling persists, discuss it openly with your co-founders.
By the way, while there is no scientific model to splitting equity, we found the “Slicing Pie” method extremely helpful in guiding our discussions.
5. Always walk towards the fire - flag problems as early as possible
Don’t avoid awkward discussions. Be 100% honest with each other. There will be difficult situations. Mastering those is what separates the successful from the less so. And some difficult situations will simply be disagreements, discontent or other bad (but human) emotions among founders.
And: do this as early as possible. One of the best tips I once got was: “always swallow the bitter pill first” (by my co-founder Christoph, by the way). Smouldering anger will make your days miserable. At some point you may explode. So put out fires before they burn you.
6. Stay close to each other and have lots and lots and lots of understanding for each other
If you can’t trust one another as funders, you’re screwed. You will be frustrated for many different reasons, even with your co-founder. Sometimes they are right and sometimes you are right. Sometimes there was a good reason for disagreement. And sometimes someone just had a bad day. Make sure you maintain the good faith among your co-founders so they are people you can turn to when your life gets tough .
Take active care that you stay close to each other. This does not happen by itself. At Yova, we have quarterly retreats where we also bring our families. We talk about the business but we also take a lot of time to consciously connect with each other. We have feedback sessions, appreciation sessions, “3 whys” sessions (see above) and more to simply make sure we stay close to each other. And of course spending fun time really helps, too.
In addition to quarterly retreats, my co-founder Erik and I also have regular 30 minute morning check-ins so that we really keep the conversation and understanding open.
7. Trust your guts as well as the data
When you’re looking for a cofounder you’re obviously looking for skills and for a person that will take over specific areas of the business, so the data is very important. But if your feelings for that person are unsure then trust your gut and decide on what feels right. You can’t predict your co-founder relationship through a balanced scorecard. But give your gut a chance: Spend time with the people to see how they tick and whether you click.
Tillmann Lang is one of the four founders of Yova Impact Investing, a company with the ambition to create a more sustainable world through investing.
Yova’s journey started at Bluelion roughly 3 years ago, and has now moved into a successful business venture.
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