6 ms·

An Open Letter To Business People

159 points by davidbalbert 16y ago

alain94040 16y ago
Pretty good explanation. A couple of tweaks: 50/50 is a bad split, because it will lead to paralysis, argument, flying chairs, and eventually bankruptcy. Second, the advice here is to not pitch the idea when you first meet potential technical co-founders. I disagree: I think sharing the same passion is key, so you definitely should tell me that you plan to revolutionize the music industry (a bad example, I know...). Small talk won't get me, the developer, interested.
- Mistone 16y ago
  whats your suggested equity split?
  - jasonshen 16y ago
    I think it really depends on how far along the idea/business guy has taken the project. If he has talked to tons of angels/VC's, or lots of potential customers, especially if those customers have indicated or even signed things saying they are ready to pay money to use the product, the split might favor the idea/business guy more than if he has just been "noodling" over something and has some "sketches" of what it might be.
    - haploid 16y ago
      This. The later you come into a given project, the less equity you would be justifiably entitled to. As to the original question, if you are starting from zero and you want a means of avoiding critical shareholder deadlocks, you can split 45/45/10 with the smaller portion going to a party both founders agree will be impartial. This person can be the initial angel, or perhaps a minor founder who accepts a smaller chunk in order to maintain his dayjob. You can also maintain 50/50 splits of ownership but still break executive deadlocks via a third vote by mandating a third seat on the board. This won't help fundamental shareholder deadlocking, but disagreements rarely go to the shareholder vote level.
  - rguzman 16y ago
    I like this: http://sethgodin.typepad.com/seths_blog/2009/03/advice-on-equity.html http://sethgodin.typepad.com/seths_blog/2009/03/advice-on-eq... Though he makes it seem easier than it really is.
- Devilboy 16y ago
  A 50/50 split can work fine as long as you have a roulette clause. With a roulette clause or similar it's always possible to easily part ways if the 2 parties reach a deadlock that cannot be resolved.
  - mdda 16y ago
    This is a definition http://www.practicallaw.com/8-203-6625 http://www.practicallaw.com/8-203-6625 - you'll have to play out a few scenarios to see the terrifyingly stark implications...
smanek 16y ago
A startup without a business plan isn't a business. It's just some code. I disagree. Users make it a business - and users don't care if I have a business plan. They just care if the product (i.e., code) makes their lives better.
- nicholasjbs 16y ago
  I mostly agree, though I don't think "business plan" in this context is meant to read "a 100+ page analysis of the market and other bullshit." Rather, I took it to mean a sense of how you're going to get the product out to users and (maybe) how you'll eventually make money. Both of those things are required if you want your business to become sustainable.
  - DevX101 16y ago
    smanek's point still stands. If your plan was incorrect and what you THOUGHT was going to make you money, doesn't do so, then you still don't have a business.
    - ABrandt 16y ago
      However it's much easier to get users if you do have a business plan, or as I prefer to think of it, a business model. If you throw something out there on the internet and start gaining users, you probably have more of a plan (model) than you think. Having just a good business model can generate sales too though. Actually there's quite an argument for doing so before writing any code. Its a whole lot easier to change some words around on a word document than to completely rewrite an application.
  - ssing 16y ago
    In spite of this being repeated so many times still it is so easy to fall into the trap. At-least it was for me. Working on my latest project we discussed so much on the feature, design and others but never on how to get users. We kinda assumed that once the project is done users will be waiting for us.
mattmaroon 16y ago
The problem is you don't need a technical cofounder, you need a good technical founder. Just because someone is at a meetup or on Github doesn't mean they're a good technical cofounder. Finding a technical cofounder isn't too difficult. If you can't sell your idea to one developer you probably can't sell it to customers. Finding a good technical cofounder is very hard.
- nicholasjbs 16y ago
  It's even harder than that: You need a good technical co-founder that you have good chemistry with.
  - shay 16y ago
    Finding this is hard, especially because we non-techies are likely on a learning curve when we're having substantive discussions with you about the evolution of our product. But I think that as long as we're informed on technology (opportunities and hurdles) and have truly crystallized some initial business plan, I think we're better poised to experience that essential chemistry.
- rguzman 16y ago
  Not only that, but what makes a good technical co-founder depends on the business. Le sigh, co-founder dating is hard.
  - rogerjin 16y ago
    True... recognizing a good technical co-founder is half the battle
- Reclix 16y ago
  I agree with you, Matt - I wouldn't want to just pick the first technical cofounder that could dazzle me with jargon I haven't heard. I'm a business type, and I absolutely believe that business types with great ideas and hypotheses they want to test can hire a team to get their minimum viable product off the ground, for a very reasonable price. And, if skilled at product development, they can get quite far on this track. Yes, of course you want to partner with a great technical co-founder, but how do you expect to attract such a hero without having proven your worth, the viability of your idea, etc. What's a bit frustrating about this post is that it's going to paralyze a lot of perfectly good business folks with the ingenuity to get it going on their own first. I'm not saying that hiring a team is a long term strategy, but in the short term? HELL YES! YOU CAN DO IT!
rguzman 16y ago
I liked the piece a lot and it is roughly right. However, as a technical co-founder, I think a good measure of a business co-founder is whether he tries to solve the technical problems himself. e.g. by learning a bit of php and hacking something together. Not only does that show that he's resourceful and scrappy, but it also makes it more likely that he'll be able to talk about the product coherently i.e. understanding and keeping in mind the constraints that software development has. It calibrates his intuition, if you will.
- marionogueira 16y ago
  Are you willing to try to solve non technical problems by yourself? You know, researching the market to assure you're actually building something people will want to use, finding paying customers or advertisers, dealing with investors, finding decent PR people, recruiting etc... nothing too fancy.
  - rguzman 16y ago
    Yes. A bit less snarky: a good measure of a technical co-founder is him trying to solve the business problems himself. For the same reasons I cited above.
    - marionogueira 16y ago
      That's the right attitude. Unfortunately, that's not the norm at all. Mostly, technical folks tend to behave as spoiled brats when dealing with non technical people as cofounders (which amazes me given that one of the best performing tech companies today is run by a non technical guy - Steve Jobs). Update: no need for the technical guy to actually work on non technical issues... given the current scenario, respecting the non technical guy within his domain would suffice. It's not like non technical people try to tell programmers how to do their job.
      - sachinag 16y ago
        Steve Jobs soldered with everyone else at Atari. Just because he didn't engineer at Apple doesn't mean he's non-technical.
terra_t 16y ago
Why do we always hear about non-technical cofounders looking for technical co-founders, rather than the other way around? Is this like some singles bar where 80% of the people are male? I for one would like to find a hustler who really knows how to hustle.
- malbiniak 16y ago
  At it's core, yes. You (and me) are in the wrong place. It's like going to the Apple store and hoping to hear great things about WP7. I don't want to be snarky, but I'm having a hard time resisting. Two technical co-founders have shuttered a business and moving on to work "hard on a new product which we're super excited about." It's great that you're super excited about it, but wouldn't it even be more exciting if you had a business minded co-founder who could demonstrate the market opportunity, or lack thereof, and make sure the time, energy, and sweat equity you're dumping into this will have some payback? I do appreciate the use of "'technical cofounder' and not 'developer.'" I think a lot of technical co-founders that also write code have been annoyed to hell by the non-technical business people who don't understand the effort required to realize their big awesome idea.
  - davidbalbert 16y ago
    I see how this might look a bit ironic ;). The reason we're shutting down HireHive and launching something new is precisely because of what we've learned in the past 8 months working in the hiring space. The only way to find out if there's market opportunity is to come up with a hypothesis and test it. So we've done that once, learned a bunch of stuff about hiring, and are pivoting to what we think is a bigger problem (still in hiring). I doubt there's a business minded co-founder who could have told us the direction we should be going in without learning what we did about hiring first.
    - malbiniak 16y ago
      I doubt there's a business minded co-founder who could have told us the direction we should be going in without learning what we did about hiring first. You're absolutely right, and I agree with this statement. I'm left with the feeling that you don't think this could have been learnt without first writing code, testing the application, and learning the expensive way. It's tough, awkward, and often frustrating, but you can connect with potential users ("prospects" or "strangers") and flesh your idea out without writing a line of code. People are willing to talk, but you have to approach them -- and go outside of your comfort zone to find them.
Apreche 16y ago
Wrote basically the same thing a month ago. http://comments.apreche.net/166/no-you-need-a-technical-co-founder/ http://comments.apreche.net/166/no-you-need-a-technical-co-f... The one thing that I don't understand is how people are willing to be paid in equity. Do you people not have to pay rent? Are you living in your parents basements with someone feeding you? In the words of many a Taxi driver "NO! You pay me cash now!" Lottery tickets don't keep the lights on.
- rguzman 16y ago
  The one thing that I don't understand is how people are willing to be paid in equity. Do you people not have to pay rent? Are you living in your parents basements with someone feeding you? Hint: savings.
grellas 16y ago
This is a nice piece overall but, having seen founders negotiate their splits countless times over nearly three decades, I would add that such negotiations tend to be more nuanced than equal splits in most cases. Idea people may not be able to proceed without solid technical people but what they do or don't have to give them for their services is always governed by supply and demand. An exceptional technical person who will drive a company will get an equal split (or more) but someone whose skills can be supplied by a good number of people will likely get far less. Strong technical expertise does tend to be hugely important in a typical startup but is only marketable consistent with what people are willing to pay for it in light of other alternatives. So too with idea people. Abstract ideas may not have much value but many of the best ideas come from those "in the field," i.e., who have worked extensively in a given area and have special insights about how, e.g., customer pain points can be addressed effectively. Such ideas can be incredibly valuable and they do not necessarily come from technical people. They can come from managers, from sales people, or from a broad variety of sources - even from those with a technical background who later moved into sales or management and who combine their skill set with their experience to derive special insights. When people like that want to found a company, they may lack the particular technical expertise to execute on the project but they will know enough about the industry to know where to find the best candidates to fill such a role. That may result in a 50/50 deal but it could easily result in all sorts of splits, even if one of the roles is prominent enough to be called "technical co-founder." So, as a technical founder, you should push for as large a split as your personal qualities can command but you should not use any arbitrary formula for determining splits. The rule is and always will be to assess the situation based on the real value each person is contributing and this often leads to a wide range of founder splits that are far from equal yet are perfectly suitable for the persons involved. That said, this again is a fine piece reminding those with technical skills not to sell themselves short in dealing with business people. There are all sorts of hustlers out there who are more than willing to take advantage of you and, if you do not value yourself properly, you will likely fall victim to them. If people really do have valuable things to contribute, however - whether on the business or on the technical side - then the process is not really that adversarial because smart people will know an opportunity when they see it, whether or not they get equal shares in the venture, and they will usually work these things out in a way that is amicable.
joshklein 16y ago
The author makes the assumption in this relationship that the technical co-founder is a talented hacker who has read all of Paul Graham's essays, maybe a Steve Blank book or two, and is well connected in the startup tech scene, all while the business co-founder is just some marketing shmuck. The characterization is unfair; there are plenty of marketing shmucks, but they should be compared against socially inept code monkeys, not this superstar technical co-founder (say, the kind that read Hacker News). A great "business person" doesn't just flip open a roledex and start dialing for dollars once the technical co-founder has laid a magical golden software egg. And hopefully, a technical and non-technical co-founder can find a way to work together where they don't perceive their partner as a parasitic dead-weight.
marionogueira 16y ago
btw, a good technical cofounder isn't "just" a good programmer (or even a great one)... actually, he doesn't even have to be the best programmer on the team
QuantumGood 16y ago
Guy says he doesn't value the "vision guy" that much...has he looked at the photo he's using? It's not even sized properly. Simple, simple fix: http://i.imgur.com/o73DX.png http://i.imgur.com/o73DX.png
T_S_ 16y ago
Before embarking on new venture, everybody should watch the "Treasure of the Sierra Madre", a great movie, directed by John Huston, starring Humphrey Bogart. There you will see that the real problems begin once you have a whiff of success. Oh forget it. Go see the "The Social Network" if you want to see that. Give a huge majority of shares to your technical cofounder and try to stay on his good side.
chadp 16y ago
Maybe the title should read, business focused entrepreneurs with no money. If I am a entrepreneur and I have money, I will not be looking for a "technical co-founder". I will hire technical teams to build and iterate the product to my liking and specification, with their expert input of course (which I can choose to accept or not).
netcan 16y ago
I listened to a Mixergy podcast earlier this week where the founder (a "business founder") started by doing some customer development, getting a prototype developed (paying to get it done, raising a round and then going to find co founders. Andrew (interviewer) assumed this meant a higher equity portion, but Rafael said it was close to an even split. The logic seemed to be that he could get better co founders this way. To anyone who sees themselves in David's (the poster) position: How would you feel about coming on board at this stage? How would you feel about coming on board at this stage minus the investors?
ndl 16y ago
I have a few things to add to this. Know something I don't. Plenty of people seem to operate under a false dichotomy between code and business, where "not programming" gets treated as a business skill. I consider myself a hybrid hacker/businessman, but stronger on the hacker side for now. If I am to take a "business person" as a partner, I'm looking for that person to do things I couldn't learn easily from a day of reading. This could mean lots of things: truly understanding markets and pricing, being a professional member of a specialized target market, legal and accounting training, unlimited patience for customer support, etc. I see some "business" people making the same mistakes they're supposed to prevent. The stereotype is of a programmer who builds and builds without testing the market, but how many non-programmers try to recruit techs to hack together a totally untested but "revolutionary" idea? Another thing I've gotten wiser to is the use of vague terms, like "leadership" and "networking." To me this comes off as "I wanna be the boss and hang out." If you really are good at these things, try to give some specifics. Finally, if I wanted to have a boss and live in a hole, I'd get a job at X big corporation. This is the point I expect the most disagreement on. I don't want a business founder who will "take over" all of the networking. By deciding to be a founder, I've already bet that I can manage myself better than someone else can manage me.
locomoto 16y ago
This piece gave me a couple of red flags even before I started into the article - primarily the adversarial premise in the title and implied put down of "business people". Remember the time when your VP or manager walks into the room and begin with "you people need to ..."? As a tech founder, I realize how many aspects of technologies and competencies I need to get right to move the startup to somewhere near a profitable business. There are very few super techs who "know it all". There are legal techies, business techies, hardware techies, etc and probably will look down with similar disdain that a "coding techie" who just don't get it. That attitude is not going to be conducive to building relationship all around. I would suggest looking at any proposition that comes your way as what a good angel or VC would - ask the right questions, be helpful, do your due diligence, say no politely and walk away if it does not interest you. We techies must educate ourselves how to evaluate a startup proposition and be helpful where possible to build our network because the network may yield answers in our "next" startup.

159 points by davidbalbert 16y ago

Pretty good explanation. A couple of tweaks: 50/50 is a bad split, because it will lead to paralysis, argument, flying chairs, and eventually bankruptcy. Second, the advice here is to not pitch the idea when you first meet potential technical co-founders. I disagree: I think sharing the same passion is key, so you definitely should tell me that you plan to revolutionize the music industry (a bad example, I know...). Small talk won't get me, the developer, interested.

Mistone 16y ago
whats your suggested equity split?
- jasonshen 16y ago
  I think it really depends on how far along the idea/business guy has taken the project. If he has talked to tons of angels/VC's, or lots of potential customers, especially if those customers have indicated or even signed things saying they are ready to pay money to use the product, the split might favor the idea/business guy more than if he has just been "noodling" over something and has some "sketches" of what it might be.
  - haploid 16y ago
    This. The later you come into a given project, the less equity you would be justifiably entitled to. As to the original question, if you are starting from zero and you want a means of avoiding critical shareholder deadlocks, you can split 45/45/10 with the smaller portion going to a party both founders agree will be impartial. This person can be the initial angel, or perhaps a minor founder who accepts a smaller chunk in order to maintain his dayjob. You can also maintain 50/50 splits of ownership but still break executive deadlocks via a third vote by mandating a third seat on the board. This won't help fundamental shareholder deadlocking, but disagreements rarely go to the shareholder vote level.
- rguzman 16y ago
  I like this: http://sethgodin.typepad.com/seths_blog/2009/03/advice-on-equity.html http://sethgodin.typepad.com/seths_blog/2009/03/advice-on-eq... Though he makes it seem easier than it really is.
Devilboy 16y ago
A 50/50 split can work fine as long as you have a roulette clause. With a roulette clause or similar it's always possible to easily part ways if the 2 parties reach a deadlock that cannot be resolved.
- mdda 16y ago
  This is a definition http://www.practicallaw.com/8-203-6625 http://www.practicallaw.com/8-203-6625 - you'll have to play out a few scenarios to see the terrifyingly stark implications...

smanek 16y ago

A startup without a business plan isn't a business. It's just some code. I disagree. Users make it a business - and users don't care if I have a business plan. They just care if the product (i.e., code) makes their lives better.

nicholasjbs 16y ago
I mostly agree, though I don't think "business plan" in this context is meant to read "a 100+ page analysis of the market and other bullshit." Rather, I took it to mean a sense of how you're going to get the product out to users and (maybe) how you'll eventually make money. Both of those things are required if you want your business to become sustainable.
- DevX101 16y ago
  smanek's point still stands. If your plan was incorrect and what you THOUGHT was going to make you money, doesn't do so, then you still don't have a business.
  - ABrandt 16y ago
    However it's much easier to get users if you do have a business plan, or as I prefer to think of it, a business model. If you throw something out there on the internet and start gaining users, you probably have more of a plan (model) than you think. Having just a good business model can generate sales too though. Actually there's quite an argument for doing so before writing any code. Its a whole lot easier to change some words around on a word document than to completely rewrite an application.
- ssing 16y ago
  In spite of this being repeated so many times still it is so easy to fall into the trap. At-least it was for me. Working on my latest project we discussed so much on the feature, design and others but never on how to get users. We kinda assumed that once the project is done users will be waiting for us.

mattmaroon 16y ago

The problem is you don't need a technical cofounder, you need a good technical founder. Just because someone is at a meetup or on Github doesn't mean they're a good technical cofounder. Finding a technical cofounder isn't too difficult. If you can't sell your idea to one developer you probably can't sell it to customers. Finding a good technical cofounder is very hard.

nicholasjbs 16y ago
It's even harder than that: You need a good technical co-founder that you have good chemistry with.
- shay 16y ago
  Finding this is hard, especially because we non-techies are likely on a learning curve when we're having substantive discussions with you about the evolution of our product. But I think that as long as we're informed on technology (opportunities and hurdles) and have truly crystallized some initial business plan, I think we're better poised to experience that essential chemistry.
rguzman 16y ago
Not only that, but what makes a good technical co-founder depends on the business. Le sigh, co-founder dating is hard.
- rogerjin 16y ago
  True... recognizing a good technical co-founder is half the battle
Reclix 16y ago
I agree with you, Matt - I wouldn't want to just pick the first technical cofounder that could dazzle me with jargon I haven't heard. I'm a business type, and I absolutely believe that business types with great ideas and hypotheses they want to test can hire a team to get their minimum viable product off the ground, for a very reasonable price. And, if skilled at product development, they can get quite far on this track. Yes, of course you want to partner with a great technical co-founder, but how do you expect to attract such a hero without having proven your worth, the viability of your idea, etc. What's a bit frustrating about this post is that it's going to paralyze a lot of perfectly good business folks with the ingenuity to get it going on their own first. I'm not saying that hiring a team is a long term strategy, but in the short term? HELL YES! YOU CAN DO IT!

rguzman 16y ago

I liked the piece a lot and it is roughly right. However, as a technical co-founder, I think a good measure of a business co-founder is whether he tries to solve the technical problems himself. e.g. by learning a bit of php and hacking something together. Not only does that show that he's resourceful and scrappy, but it also makes it more likely that he'll be able to talk about the product coherently i.e. understanding and keeping in mind the constraints that software development has. It calibrates his intuition, if you will.

marionogueira 16y ago
Are you willing to try to solve non technical problems by yourself? You know, researching the market to assure you're actually building something people will want to use, finding paying customers or advertisers, dealing with investors, finding decent PR people, recruiting etc... nothing too fancy.
- rguzman 16y ago
  Yes. A bit less snarky: a good measure of a technical co-founder is him trying to solve the business problems himself. For the same reasons I cited above.
  - marionogueira 16y ago
    That's the right attitude. Unfortunately, that's not the norm at all. Mostly, technical folks tend to behave as spoiled brats when dealing with non technical people as cofounders (which amazes me given that one of the best performing tech companies today is run by a non technical guy - Steve Jobs). Update: no need for the technical guy to actually work on non technical issues... given the current scenario, respecting the non technical guy within his domain would suffice. It's not like non technical people try to tell programmers how to do their job.
    - sachinag 16y ago
      Steve Jobs soldered with everyone else at Atari. Just because he didn't engineer at Apple doesn't mean he's non-technical.

terra_t 16y ago

Why do we always hear about non-technical cofounders looking for technical co-founders, rather than the other way around? Is this like some singles bar where 80% of the people are male? I for one would like to find a hustler who really knows how to hustle.

malbiniak 16y ago
At it's core, yes. You (and me) are in the wrong place. It's like going to the Apple store and hoping to hear great things about WP7. I don't want to be snarky, but I'm having a hard time resisting. Two technical co-founders have shuttered a business and moving on to work "hard on a new product which we're super excited about." It's great that you're super excited about it, but wouldn't it even be more exciting if you had a business minded co-founder who could demonstrate the market opportunity, or lack thereof, and make sure the time, energy, and sweat equity you're dumping into this will have some payback? I do appreciate the use of "'technical cofounder' and not 'developer.'" I think a lot of technical co-founders that also write code have been annoyed to hell by the non-technical business people who don't understand the effort required to realize their big awesome idea.
- davidbalbert 16y ago
  I see how this might look a bit ironic ;). The reason we're shutting down HireHive and launching something new is precisely because of what we've learned in the past 8 months working in the hiring space. The only way to find out if there's market opportunity is to come up with a hypothesis and test it. So we've done that once, learned a bunch of stuff about hiring, and are pivoting to what we think is a bigger problem (still in hiring). I doubt there's a business minded co-founder who could have told us the direction we should be going in without learning what we did about hiring first.
  - malbiniak 16y ago
    I doubt there's a business minded co-founder who could have told us the direction we should be going in without learning what we did about hiring first. You're absolutely right, and I agree with this statement. I'm left with the feeling that you don't think this could have been learnt without first writing code, testing the application, and learning the expensive way. It's tough, awkward, and often frustrating, but you can connect with potential users ("prospects" or "strangers") and flesh your idea out without writing a line of code. People are willing to talk, but you have to approach them -- and go outside of your comfort zone to find them.

Apreche 16y ago

Wrote basically the same thing a month ago. http://comments.apreche.net/166/no-you-need-a-technical-co-founder/ http://comments.apreche.net/166/no-you-need-a-technical-co-f... The one thing that I don't understand is how people are willing to be paid in equity. Do you people not have to pay rent? Are you living in your parents basements with someone feeding you? In the words of many a Taxi driver "NO! You pay me cash now!" Lottery tickets don't keep the lights on.

rguzman 16y ago
The one thing that I don't understand is how people are willing to be paid in equity. Do you people not have to pay rent? Are you living in your parents basements with someone feeding you? Hint: savings.

grellas 16y ago

This is a nice piece overall but, having seen founders negotiate their splits countless times over nearly three decades, I would add that such negotiations tend to be more nuanced than equal splits in most cases. Idea people may not be able to proceed without solid technical people but what they do or don't have to give them for their services is always governed by supply and demand. An exceptional technical person who will drive a company will get an equal split (or more) but someone whose skills can be supplied by a good number of people will likely get far less. Strong technical expertise does tend to be hugely important in a typical startup but is only marketable consistent with what people are willing to pay for it in light of other alternatives. So too with idea people. Abstract ideas may not have much value but many of the best ideas come from those "in the field," i.e., who have worked extensively in a given area and have special insights about how, e.g., customer pain points can be addressed effectively. Such ideas can be incredibly valuable and they do not necessarily come from technical people. They can come from managers, from sales people, or from a broad variety of sources - even from those with a technical background who later moved into sales or management and who combine their skill set with their experience to derive special insights. When people like that want to found a company, they may lack the particular technical expertise to execute on the project but they will know enough about the industry to know where to find the best candidates to fill such a role. That may result in a 50/50 deal but it could easily result in all sorts of splits, even if one of the roles is prominent enough to be called "technical co-founder." So, as a technical founder, you should push for as large a split as your personal qualities can command but you should not use any arbitrary formula for determining splits. The rule is and always will be to assess the situation based on the real value each person is contributing and this often leads to a wide range of founder splits that are far from equal yet are perfectly suitable for the persons involved. That said, this again is a fine piece reminding those with technical skills not to sell themselves short in dealing with business people. There are all sorts of hustlers out there who are more than willing to take advantage of you and, if you do not value yourself properly, you will likely fall victim to them. If people really do have valuable things to contribute, however - whether on the business or on the technical side - then the process is not really that adversarial because smart people will know an opportunity when they see it, whether or not they get equal shares in the venture, and they will usually work these things out in a way that is amicable.

joshklein 16y ago

The author makes the assumption in this relationship that the technical co-founder is a talented hacker who has read all of Paul Graham's essays, maybe a Steve Blank book or two, and is well connected in the startup tech scene, all while the business co-founder is just some marketing shmuck. The characterization is unfair; there are plenty of marketing shmucks, but they should be compared against socially inept code monkeys, not this superstar technical co-founder (say, the kind that read Hacker News). A great "business person" doesn't just flip open a roledex and start dialing for dollars once the technical co-founder has laid a magical golden software egg. And hopefully, a technical and non-technical co-founder can find a way to work together where they don't perceive their partner as a parasitic dead-weight.

marionogueira 16y ago

btw, a good technical cofounder isn't "just" a good programmer (or even a great one)... actually, he doesn't even have to be the best programmer on the team

QuantumGood 16y ago

Guy says he doesn't value the "vision guy" that much...has he looked at the photo he's using? It's not even sized properly. Simple, simple fix: http://i.imgur.com/o73DX.png http://i.imgur.com/o73DX.png

T_S_ 16y ago

Before embarking on new venture, everybody should watch the "Treasure of the Sierra Madre", a great movie, directed by John Huston, starring Humphrey Bogart. There you will see that the real problems begin once you have a whiff of success. Oh forget it. Go see the "The Social Network" if you want to see that. Give a huge majority of shares to your technical cofounder and try to stay on his good side.

chadp 16y ago

Maybe the title should read, business focused entrepreneurs with no money. If I am a entrepreneur and I have money, I will not be looking for a "technical co-founder". I will hire technical teams to build and iterate the product to my liking and specification, with their expert input of course (which I can choose to accept or not).

netcan 16y ago

I listened to a Mixergy podcast earlier this week where the founder (a "business founder") started by doing some customer development, getting a prototype developed (paying to get it done, raising a round and then going to find co founders. Andrew (interviewer) assumed this meant a higher equity portion, but Rafael said it was close to an even split. The logic seemed to be that he could get better co founders this way. To anyone who sees themselves in David's (the poster) position: How would you feel about coming on board at this stage? How would you feel about coming on board at this stage minus the investors?

ndl 16y ago

I have a few things to add to this. Know something I don't. Plenty of people seem to operate under a false dichotomy between code and business, where "not programming" gets treated as a business skill. I consider myself a hybrid hacker/businessman, but stronger on the hacker side for now. If I am to take a "business person" as a partner, I'm looking for that person to do things I couldn't learn easily from a day of reading. This could mean lots of things: truly understanding markets and pricing, being a professional member of a specialized target market, legal and accounting training, unlimited patience for customer support, etc. I see some "business" people making the same mistakes they're supposed to prevent. The stereotype is of a programmer who builds and builds without testing the market, but how many non-programmers try to recruit techs to hack together a totally untested but "revolutionary" idea? Another thing I've gotten wiser to is the use of vague terms, like "leadership" and "networking." To me this comes off as "I wanna be the boss and hang out." If you really are good at these things, try to give some specifics. Finally, if I wanted to have a boss and live in a hole, I'd get a job at X big corporation. This is the point I expect the most disagreement on. I don't want a business founder who will "take over" all of the networking. By deciding to be a founder, I've already bet that I can manage myself better than someone else can manage me.

locomoto 16y ago

This piece gave me a couple of red flags even before I started into the article - primarily the adversarial premise in the title and implied put down of "business people". Remember the time when your VP or manager walks into the room and begin with "you people need to ..."? As a tech founder, I realize how many aspects of technologies and competencies I need to get right to move the startup to somewhere near a profitable business. There are very few super techs who "know it all". There are legal techies, business techies, hardware techies, etc and probably will look down with similar disdain that a "coding techie" who just don't get it. That attitude is not going to be conducive to building relationship all around. I would suggest looking at any proposition that comes your way as what a good angel or VC would - ask the right questions, be helpful, do your due diligence, say no politely and walk away if it does not interest you. We techies must educate ourselves how to evaluate a startup proposition and be helpful where possible to build our network because the network may yield answers in our "next" startup.