Resolving co-founder conflicts

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Got a lot of feedback on my post on “How to find a co-founder” yesterday, including founders asking me how they can resolve conflicts with their co-founders.

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This is one of the hardest questions for me to answer because conflicts are so situational, often personal and if they are hard to resolve they are often complex with multiple resolution paths.

Before we talk about the conflict at hand, we need to look at the founders themselves and ask, are these emotionally mature founders who are self-aware? Most of the founders I work with are highly-driven, highly-skilled, persuasive and passionate individuals, but often they are young and emotionally inexperienced. Sometimes they are older but not very self-aware.

Most conflicts I see are a subset of all startup conflicts: the problems co-founders can’t resolve and they bring to a trusted 3rd party, in this case, an investor.

These conflicts are often not as hard to resolve as they seem, and are driven by the co-founders being under massive pressure and having not done the work to connect deeply with each other.

Let’s create a scenario. Two founders are debating if they should fire their director of sales, Joe. Joe is a great culture fit and is super positive, but his performance is below average. He misses targets and after two PiPs (performance improvement plans), he hasn’t improved.

Co-founder John, the product visionary, believes that since they have money in the bank and since Joe is loved by everyone, they should keep working with him. Perhaps there is another role in the company, and Joe was their first hire. Joe recruited three of the best people in the company and he hosts the weekly happy hour. It would be a shock to lose him.

Co-founder Joanne, the CEO, and operations killer, believes that Joe had his shot, had two PiPs over nine months, and since Joanne has to manage Joe, it’s her call and she believes it’s a waste of time to keep average people around. Besides, Joe can’t even come in on time and is the first to leave, with his jacket on at 5:29 PM. With a gentle transition out — for example, a three-month consulting agreement — we can manage the culture issues.

Things have devolved to the point at which I’ve been brought in as the angel investor. This is what I would do:

  1. “Joanne and John, let’s take a walk and have lunch.”
  2. “Why don’t you each explain to me your positions?”
  3. “I think I understand the situation… it feels like there are many solutions to this problem. Why do you think it’s come to a head? Are there other uncomfortable issues we need to put out on the table now since we’re hashing everything out so that we can get back to work?”

In these situations, what I’ve seen is that the issue at hand is almost never the actual issue. All kinds of issues can come pouring out during these sessions, and that’s a good thing. The more you talk about the issues, the less power they have over you.

I set up this scenario as a coin toss on purpose.

Was your initial reaction to try to solve the problem?

Did your mind immediately take John or Joanne’s side?

In this situation, if the company were Slack or Uber, you could obviously do a coin toss and the company would do just fine taking Joanne or John’s side. What matters here is that the two co-founders take the time to hear each other out and have the emotional maturity — and agility — to say to each other, “this is a coin toss, I trust you and I’m fine with whatever decision we make; let’s just agree to monitor the situation and stay focused on what matters: our customers.”

If only life were this simple. I’ve seen founders who are dealing with children or serious mental issues (anxiety, depression, bipolar, etc.), as well as founders who simply lacked any self-awareness. Sometimes folks have substance problems, other times their marriages are breaking down or their parent is dying of cancer.   

Business is very personal, despite what they say in the movies, and co-founder conflicts often require taking that long walk or having that long family-style meal. It might also require calling your investor and admitting that you can’t resolve this conflict, or that the conflict is the smoke and that the fire is a highly personal issue.

If you have a great investor, they’ve seen it all and they will help you. That’s why we’re here, to help you when things are hard to resolve… send the text, set up the walk and talk and don’t let things fester.

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