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Paul Graham, Dropbox and The Single Founder Exception

118 points by jkuria 15y ago

seven_stones 15y ago
This whole treatment is a little odd. First, he had a second "founder" before the program started, so it wasn't single-founder. Second, luckily the second guy turned out to be "perfect". This could easily have backfired. It is far more likely that adding someone as a founder who you haven't worked with before will torpedo the company. IIRC, YC made this point previously. So actually it was bad advice, like hitting on 17 in Blackjack, or not getting the right pot odds to call in Hold'em, and then calling anyway. If you win, it's just dumb luck. If you try running the experiment a hundred times, adding an extra unknown person not only to a promising single founder but also trying to make promising two-person groups into three-person groups, you're going to decrease almost everyone's chances. Third, there is pronounced over-romanticization of founders. It is extremely common for the founders to NOT be the most important cogs in their own companies. It is very common for companies to be started by people who have money but not skills, and of course then the people who DO everything are non-founders. It is also common for founders with skills to have employees with much better skills at the same thing. And even the decision-making is frequently done by advisors who guide the young and inexperienced founders on every key issue regarding having a company. Tom was just the PR cover for MySpace. And who do you think really runs Facebook? Or Apple in its early days? Woz never ran engineering at Apple, and Jobs didn't run the company until his second coming. The gee-whiz kids in the dorms and garages are just the figureheads to market to their demographic. Just like Hot Topic markets to people who want to make a show out of how they refuse to conform by buying non-conformist uniforms in malls. And dedication, sure. But some companies get lucky in less than a year, like Auctomatic. PG had to work for THREE years before he could retire. Drew has been going for four. But dedication isn't as rare as it seems. Just look at the factory workers who work harder jobs for longer hours year after year making their Macbooks. Overemphasis on founders hurts companies. One of the reasons it's so hard to hire is that founders think it's "generous" to offer a fraction of a percent equity to someone they desperately need to do the thing the company was founded to make in the first place. IIRC, RethinkDB is/was in this boat. If you don't start with the needed expertise, and you find that you need to hire it or else you don't have a product, why would someone come work for you for 0.5% and average salary when by definition he could just start his own company doing the same thing? So there are a zillion startups each with a handful of people at most and they all complain about the scarcity of talent, while they are offering the same or less as big companies that stick you with less responsibility, fewer hours, and no worries about burn rate. Being a founder isn't special. What's special is solving hard problems and making the decisions that lead to a successful product or useful technology. That is orthogonal to being a founder. No, really. Founders aren't special. SBA.gov: > An estimated 627,200 new employer firms began operations in 2008, and 595,600 firms closed that year. This amounts to an annual turnover of about 10 percent for entry and 10 percent for exit. Nonemployer firms have turnover rates three times as high as those of employer firms, mostly because of easier entry and exit conditions. If you want a successful company, come off your high horse and spread out the equity. I've seen promising companies bite the dust or spin their wheels for years because the founder(s) couldn't bear to part with their equity, and end up holding close to a hundred percent of nothing.
aston 15y ago
From Forbes to Hacker News back to Forbes back to Hacker News. Definition of an echo chamber. In case a Forbes reporter wants to quote me, this comment is not for attribution.
- Shenglong 15y ago
  Maybe if pg responds here, someone will write a story about it too.
  - llambda 15y ago
    I guess the Forbes bloggers are in need of material..? Although that said I can't say the articles were particularly bad. Maybe it is a stretch to continue to focus on the same article after it's been published as a feature. Certainly if nothing new and significant is being added it's a bit of a waste.
- wumi 15y ago
  Although they could -- and should -- write a story about the unsung hero of Dropbox.
craze3 15y ago
I don't understand where the fixation for multiple founders stems from. I know it increases the chances that the startup will succeed, but sometimes it's unnecessary. I'm starting to think that it's more of a power struggle issue- If YC can't get one founder to agree with or sign off on something, then they want to be able to approach the other founder and convince them instead.
- Retric 15y ago
  Secondary founders work for less pay than anyone else in exchange for large chunks of equity which can be a huge asset for a tiny company. Add in the validation of being able to convince someone else that you have a good enough idea to take such helps convince VC's that the idea has merit. Having someone else committed also means you have someone to bounce ideas off of at 7:30pm that knows the issues and can give new incite is huge. Finally, it reduces your buss factor where is someone get's sick the company can still operate.
- ghshephard 15y ago
  " I know it increases the chances that the startup will succeed, but sometimes it's unnecessary. " Simply knowing that it increases the chances that the startup will succeed should be sufficient to understand where the fixation for multiple founders stems from. True, it's not required 100% of the time, but, a-priori, how can anyone know whether this is one of those times. There are a hundred well defined things that can contribute to the failure of a startup (in addition to the thousand less well defined things) - one thing that YC brings to the table is identifying that list of 100 things that can kill a startup so they can be avoided. Coming in with at least one cofounder brings the list to 99. Incorporating in Delaware to 98. Having someone who can code 97. etc, etc, etc...
  - sandee 15y ago
    Is there really a YC list of 100 things that can kill a startup so they can be avoided ? Very interested to know
    - 15y ago
callmeed 15y ago
"Dropbox being the biggest home run YC has had to date" That's still Heroku in my book
- davetong 15y ago
  Interesting... Are you measuring by the number of users or revenue?
  - callmeed 15y ago
    Not measuring. A "home run" to me is an exit, not a huge round at a huge valuation. But maybe it was an exit for YC/early investors, I don't know.
    - staunch 15y ago
      Dropbox took in $250 million cash for 6% of the company. Heroku took in $240 million cash for 100%.
      - wlievens 15y ago
        And as soon as Dropbox becomes liquid, it will certainly be the biggest homerun.
        seunosewa 15y ago
        Unless it fails, of course.
        ridruejo 15y ago
        At this stage it cannot "fail" in the traditional sense. Even if it enters a downward spiral, at any point in time it could be sold for the user base alone (and the price would still likely to be bigger than Heroku)
        15y ago
staunch 15y ago
What if Arash had turned out to be a bad match? They didn't know each other, so it was a pretty big gamble. I suppose if Drew retained control he could prevent it destroying the company, but then he doesn't really have an equal co-founder to keep him in check. Seems like a really tough problem. Kind of amazing it worked out so well.
- pg 15y ago
  Oddly enough Drew and I talked about this question tonight on a panel at the Computer History Museum. It was a big risk to recruit someone as a cofounder that he didn't know before (and I've seen a lot of cases where it didn't work out) but in this case the risk was mitigated by how much they had in common. One thing they had in common was Kyle Vogt of Justin.tv, who introduced them. So in retrospect the YC alumni network was having a big effect even back then.
  - NY_Entrepreneur 15y ago
    Even if the roulette ball drops into the slot 00, the play was still a "big risk", and so was, under the circumstances, insisting on a cofounder. That is, given how much Drew had already done, a cofounder had to be mostly just downside risk. The 'mitigation' had to be minimal. Or, Drew's left hand doesn't fight with his right hand, but cofounders can easily fight. If a cofounder is really needed, then so be it. But a cofounder is always risky, and a single founder who has already done well starting the business has a big advantage just because his left hand won't fight with his right hand. Now a single founder can do much more than in past years, even just five years ago. And here's a big point: always in a startup very much want the CEO to 'understand his business'. In an IT software startup, that includes understanding the software. But software has now changed: E.g., with .NET, nearly everything needed in commercial computing, and a larger fraction of Web site construction, is already in the .NET classes. So, the work is just writing a little 'glue' code between the uses of the classes. So, the coding goes VERY quickly. But what doesn't go quickly is understanding the classes because need about 10 books each of 500-1000 pages and, even for just a Web site, about 3000 Web pages of documentation from MSDN. And, this understanding of .NET is just 'overhead' that have to pay just once per programming task solved with a .NET class actually understand well. So, to 'know his business', a CEO needs to know the relevant parts of, say, .NET. A cofounder can't help here. And once the CEO does have that .NET knowledge, there can be some serious question if a cofounder can add much. Just what the Linux world has in place of .NET I don't know, but it can't be both small and effective. There is other evidence: Look up and down Main Street at the successful businesses that have been started there. Typically there's only one person who is the real 'founder'. Look at research: Bright ideas come first to just one person at a time. Period. Microsoft: A Bill Gates show. Apple: A Steve Jobs show. Berkshire: A Warren Buffett show. Renaissance: A James Simons show. Continue with the one man shows of Kolmogorov, von Neumann, Knuth, etc. and in music Heifetz, Rostropovich, Tchaikovsky, Beethoven, Mozart, Bach, etc. It's tough enough to find a Michelangelo to paint the ceiling. Getting him a 'copainter' who would actually help would be impossible. As you add people to a team, the team regresses to the mean where you don't want to be. And, did I mention fights? Sorry 'bout that.
bradhe 15y ago
The people who are most upset about the single founder rule are the people who were rejected by YC because they couldn't find a co-founder.
- llambda 15y ago
  Or perhaps people who thought they had a good idea or project and then took on a second founder in the hopes of getting into YC but then found that the person didn't work out.
DodgyEggplant 15y ago
A co-founder is also the minimum social proof. Find at least one person in the world who is willing to bet on you and your startup.
- sunnydaynow 15y ago
  Yeah, right. You forget: That is easy in college, but actually much more difficult later in life when all your friends have jobs and family. In other words, works in some way as a nicely worded age discrimination. Not that it affects me, but getting older makes you more sensitive for these things ;)
  - deleted 15y ago
    [deleted]
  - ig1 15y ago
    You presumably know far more professional developers at a later stage of your career than someone fresh out of university, so you have a far bigger pool to find someone out of. Most of the people who are just finishing university and getting into YC aren't people who would be struggling to find jobs, these are people who are choosing to work for a startup over going to work for Google or Goldman Sachs for a six-figure salary. The fact that someone older is more likely to have a mortgage and family commitments and thus be unable to relocate for three months and give up their salary is far more likely to weed out older candidates than the co-founder requirement.
    - sunnydaynow 15y ago
      The 25-year old knows that if his startup fails he can easily find a first (or new) job at Google etc two years later. That does not apply to 45+ year olds. The risk is much higher.
      - ig1 15y ago
        I don't get this, presumably by that point in their career they'd have a huge network of people they've worked with in the past and who would be eager to hire them ?
joshuamerrill 15y ago
As a single founder who's about to close his seed round (and was rejected from YC), I'm deeply concerned that opinions toward single founders are devolving from aversion, to bias, to self-fulfilling prophecy. With every step, investors are forfeiting the ability (or inclination) to evaluate this issue on the merits. I personally have no trouble working with others, nor difficulty enrolling others in my vision. I am extremely emotionally stable—I don't take things personally and have little trouble riding the ups and downs. I acknowledge that there are benefits to a cofounder that I'm missing out on (as well as drawbacks I'm avoiding!), but simply put, it's disappointing to see many investors marching lock-step to the beat of someone else's drum.
- CamperBob 15y ago
  I personally have no trouble working with others, nor difficulty enrolling others in my vision. I am extremely emotionally stable—I don't take things personally and have little trouble riding the ups and downs I'll leave the HAL 9000 jokes to someone who can afford the karma hit...
- dmk23 15y ago
  I take a very simple perspective on this "single founder aversion". If some investor is going to ignore my traction and business just because I achieved it without signing on a token co-founder, then frankly it is their loss and I won't hesitate to politely tell them that. By definition getting to the same results without co-founders requires a much higher level of ability than if being part of a "collective". Any investor failing to recognize that is going to miss out some of the best deals and that is really their problem. The main focus should be on pleasing customers and partners and if you do that right, eventually the right investors come along (with better terms too). Much better approach than to structure your company solely to please investors and forget what the business is all about. You might even end up with a business making money and no investors to answer to (or at least investors not having significant control over you). What a terrible thing! PS: Quite a few people promoted to "co-founders" should really be employees with accountability for specific tasks and projects, not an open-ended license to call the shots.
  - 15y ago
phatbyte 15y ago
I'm also a single founder, and I'm investing part of my own money that I've been saving from all these years as a developer. Being a single founder is hard, you have to deal with everything from incorporating, accounting, writing code, design, worry about SEO, how to introduce your project to the world get some momentum, etc.. Plus, add that to the fact that I'm from Europe, VC is very complicated here. But because it's hard we should be more appreciated and not put aside. I'm working on it for at least 3 months now and it's 90% complete, I've been able to keep motivated and I've learned lot along the way. I just felt that this was the right path to go for me, I didn't feel the need have someone as a parter on this. I may be wrong in a long run but for now I'm pretty satisfied with what I've done. Obviously I don't agree with YC rule here, I understand some of their view points , but not everything is true or false. Some great projects maybe aren't being looked into because of the single-founder rule. But then again, you don't have to apply to YC or any funding, try something else, or simple bootstrap you idea and see how it goes.
- DaveChild 15y ago
  > I'm working on it for at least 3 months now and it's 90% complete Good luck with the other 90% ;)
NY_Entrepreneur 15y ago
On 'the rules': Again, just a fast look at VC finances shows that VC just MUST hit 'home runs' such as Dropbox or better. Then just a fast look at the history of home runs shows that get only a few each decade. And just a fast look at those home runs shows that a significant pattern is super-tough to see. And, any such pattern has only a few examples because the larger 'circumstances' change so much from one decade to another. E.g., it used to be that a trillion bytes was a REALLY large chunk of hard disk space, but now it's not so large just as main memory. So, since have to be looking for such home runs under such circumstances, what good 'rules' can be formulated? Remember, we're looking for home runs and not trying to find a description of a VCs average arriving e-mail pitch. Or we're looking for some tiny number of golden needles in in a huge pile of hay so that statements about some average about the hay are just irrelevant. Well, one could guess, 'the first rule of VC is that there are no rules', but, actually, that is too strong. But not good is the rule against 'single founders'. Why? With the larger circumstances today, a single founder has some big advantages. I will let readers fill in some of the advantages based on current circumstances just as an exercise! Next, for 'the rules', there still are some that can apply to some of the startup candidates, One collection of such candidates is based on startups where the core 'secret sauce' is especially powerful and can be evaluated just technically. For a biomedical analogy, consider a safe, effective, cheap single pill cure for any cancer: Then just evaluate the pill and f'get about the founder because if do have the pill and if he did invent it, then f'get everything else about him! He invented the pill, for god's sake! Or, we know you are plenty smart, but could you have invented that pill? So, if he's smarter than you, then you've just gotta think that he's plenty smart. I mean, given that he invented that pill, what are the chances he's a doofus? Or, to be quite specific, even worst case, just what issues of 'business acumen' couldn't be solved by hiring him a COO, CFO, SVP Operations, SVP HR? And there's no good reason to suspect such a worst case or even a bad case. Or, did I mention, the guy invented the pill? For meaningful rules to apply to all IT startup candidates, that seems to be asking too much. The simple answer that will fit on the back of the usual 3 x 5" card of VC rules that even a VC can understand is, in looking for the crucial home runs, the first rule is there are no rules.
0x12 15y ago
The downsides to having no co-founder: - you get to deal with the stress on your own (or maybe you have a supportive spouse) - you can't have soundboard sessions with your co-founders - you can't divide the labor - you have to have a lot of expertise in a variety of fields - if you get ill early on it will likely kill the company - nobody will call you out when you're spouting nonsense - likely a long long list of stuff following these The upside (and it's a huge upside) - you don't have to deal with your co-founders That one single factor does not outweigh the other ones but it is much better to have no co-founders than to have the wrong co-founder. And you can't really know in advance if you have the right co-founder or not. You'll know when you are in your first very heavy weather but by then it is too late to easily switch. That's why even if having co-founders is good plenty of people chose to go it alone, and end up hiring what would have been co-founders as early employees once they've established a certain level of success. If having no co-founders was a guaranteed fail nobody would do it, but plenty of people get by just fine to prove that it is not a hard and fast law, but more of a statistical issue.
- maratd 15y ago
  I started a business in college, by myself, and it had revenues of about 6 million by the time I hit 25. I'm now 30 and on my second business, which I also started and am now running by myself. Why don't I elaborate on some upsides to your little list? * You are the only one. That means if something goes wrong, you can't shift the blame. Not even subconsciously. It's always your fault. This guarantees problems get fixed and they get fixed fast. * You are the only one. That means you don't have to get approval or dilute your ideas. It gets implemented. Now. If you're spouting bullshit, the market will filter and you will adjust, fast. * You are the only one. You have to do everything. That means you understand every aspect of your business, because at some point, you did it. This helps you make effective decisions. * You are the only one. etc etc etc You get the idea. I can go on forever and you can go on forever listing wonderful things about co-founders. One way isn't better than another. They are different and the path you take depends on your goals. If your goal is to build a business that grows into hundred-million+ entity so you can cash out or where you can garner a cult following (i.e. Steve Jobs/Bill Gates/Larry Ellison/etc), you need a co-founder. On the other hand, if you want a business where you can pour your unmitigated passion into, where it becomes a place that not only supports you, but where your ideas take form, a co-founder will just get in your way. To dumb it down, if the #1 goal on your list is money or status, bring somebody else on. You won't be able to compete by your lonesome. However, if the #1 goal on your list is the freedom to do things the way you want to do them ... the only way to accomplish that is to remove as many obstacles to that as possible. That means no co-founders, no investors, none of it. A structure where you don't have to check with anyone before you do something. This, by the way, explains why most investors are completely against companies with no co-founders. It's not in their interest. The goals of the company do not align with their goals.
endeavor 15y ago
Are there any good examples where a single founder made it big, truly on his own? You can imagine that maybe Drew could have done it without Arash, or Gates could have done it without Allen, etc. But they didn't, which validates the exception. So before we casually say /oh if you don't feel like you need a co-founder then don't bother/, it would be good to know if any single founders have been successful. And maybe we should define success as financial/market success, not emotional fulfilment or getting your first two round of funding.
- sajid 15y ago
  Some examples of successful sole founders: Aaron Patzer (Mint), James Dyson (Dyson), Pierre Omidyar (eBay), Jeff Bezos (Amazon), Bob Parsons (GoDaddy), Craig Newmark (Craigslist)

118 points by jkuria 15y ago

This whole treatment is a little odd. First, he had a second "founder" before the program started, so it wasn't single-founder. Second, luckily the second guy turned out to be "perfect". This could easily have backfired. It is far more likely that adding someone as a founder who you haven't worked with before will torpedo the company. IIRC, YC made this point previously. So actually it was bad advice, like hitting on 17 in Blackjack, or not getting the right pot odds to call in Hold'em, and then calling anyway. If you win, it's just dumb luck. If you try running the experiment a hundred times, adding an extra unknown person not only to a promising single founder but also trying to make promising two-person groups into three-person groups, you're going to decrease almost everyone's chances. Third, there is pronounced over-romanticization of founders. It is extremely common for the founders to NOT be the most important cogs in their own companies. It is very common for companies to be started by people who have money but not skills, and of course then the people who DO everything are non-founders. It is also common for founders with skills to have employees with much better skills at the same thing. And even the decision-making is frequently done by advisors who guide the young and inexperienced founders on every key issue regarding having a company. Tom was just the PR cover for MySpace. And who do you think really runs Facebook? Or Apple in its early days? Woz never ran engineering at Apple, and Jobs didn't run the company until his second coming. The gee-whiz kids in the dorms and garages are just the figureheads to market to their demographic. Just like Hot Topic markets to people who want to make a show out of how they refuse to conform by buying non-conformist uniforms in malls. And dedication, sure. But some companies get lucky in less than a year, like Auctomatic. PG had to work for THREE years before he could retire. Drew has been going for four. But dedication isn't as rare as it seems. Just look at the factory workers who work harder jobs for longer hours year after year making their Macbooks. Overemphasis on founders hurts companies. One of the reasons it's so hard to hire is that founders think it's "generous" to offer a fraction of a percent equity to someone they desperately need to do the thing the company was founded to make in the first place. IIRC, RethinkDB is/was in this boat. If you don't start with the needed expertise, and you find that you need to hire it or else you don't have a product, why would someone come work for you for 0.5% and average salary when by definition he could just start his own company doing the same thing? So there are a zillion startups each with a handful of people at most and they all complain about the scarcity of talent, while they are offering the same or less as big companies that stick you with less responsibility, fewer hours, and no worries about burn rate. Being a founder isn't special. What's special is solving hard problems and making the decisions that lead to a successful product or useful technology. That is orthogonal to being a founder. No, really. Founders aren't special. SBA.gov: > An estimated 627,200 new employer firms began operations in 2008, and 595,600 firms closed that year. This amounts to an annual turnover of about 10 percent for entry and 10 percent for exit. Nonemployer firms have turnover rates three times as high as those of employer firms, mostly because of easier entry and exit conditions. If you want a successful company, come off your high horse and spread out the equity. I've seen promising companies bite the dust or spin their wheels for years because the founder(s) couldn't bear to part with their equity, and end up holding close to a hundred percent of nothing.

aston 15y ago

From Forbes to Hacker News back to Forbes back to Hacker News. Definition of an echo chamber. In case a Forbes reporter wants to quote me, this comment is not for attribution.

Shenglong 15y ago
Maybe if pg responds here, someone will write a story about it too.
- llambda 15y ago
  I guess the Forbes bloggers are in need of material..? Although that said I can't say the articles were particularly bad. Maybe it is a stretch to continue to focus on the same article after it's been published as a feature. Certainly if nothing new and significant is being added it's a bit of a waste.
wumi 15y ago
Although they could -- and should -- write a story about the unsung hero of Dropbox.

craze3 15y ago

I don't understand where the fixation for multiple founders stems from. I know it increases the chances that the startup will succeed, but sometimes it's unnecessary. I'm starting to think that it's more of a power struggle issue- If YC can't get one founder to agree with or sign off on something, then they want to be able to approach the other founder and convince them instead.

Retric 15y ago
Secondary founders work for less pay than anyone else in exchange for large chunks of equity which can be a huge asset for a tiny company. Add in the validation of being able to convince someone else that you have a good enough idea to take such helps convince VC's that the idea has merit. Having someone else committed also means you have someone to bounce ideas off of at 7:30pm that knows the issues and can give new incite is huge. Finally, it reduces your buss factor where is someone get's sick the company can still operate.
ghshephard 15y ago
" I know it increases the chances that the startup will succeed, but sometimes it's unnecessary. " Simply knowing that it increases the chances that the startup will succeed should be sufficient to understand where the fixation for multiple founders stems from. True, it's not required 100% of the time, but, a-priori, how can anyone know whether this is one of those times. There are a hundred well defined things that can contribute to the failure of a startup (in addition to the thousand less well defined things) - one thing that YC brings to the table is identifying that list of 100 things that can kill a startup so they can be avoided. Coming in with at least one cofounder brings the list to 99. Incorporating in Delaware to 98. Having someone who can code 97. etc, etc, etc...
- sandee 15y ago
  Is there really a YC list of 100 things that can kill a startup so they can be avoided ? Very interested to know
  - 15y ago

callmeed 15y ago

"Dropbox being the biggest home run YC has had to date" That's still Heroku in my book

davetong 15y ago
Interesting... Are you measuring by the number of users or revenue?
- callmeed 15y ago
  Not measuring. A "home run" to me is an exit, not a huge round at a huge valuation. But maybe it was an exit for YC/early investors, I don't know.
  - staunch 15y ago
    Dropbox took in $250 million cash for 6% of the company. Heroku took in $240 million cash for 100%.
    - wlievens 15y ago
      And as soon as Dropbox becomes liquid, it will certainly be the biggest homerun.
      - seunosewa 15y ago
        Unless it fails, of course.
        ridruejo 15y ago
        At this stage it cannot "fail" in the traditional sense. Even if it enters a downward spiral, at any point in time it could be sold for the user base alone (and the price would still likely to be bigger than Heroku)
        15y ago

staunch 15y ago

What if Arash had turned out to be a bad match? They didn't know each other, so it was a pretty big gamble. I suppose if Drew retained control he could prevent it destroying the company, but then he doesn't really have an equal co-founder to keep him in check. Seems like a really tough problem. Kind of amazing it worked out so well.

pg 15y ago
Oddly enough Drew and I talked about this question tonight on a panel at the Computer History Museum. It was a big risk to recruit someone as a cofounder that he didn't know before (and I've seen a lot of cases where it didn't work out) but in this case the risk was mitigated by how much they had in common. One thing they had in common was Kyle Vogt of Justin.tv, who introduced them. So in retrospect the YC alumni network was having a big effect even back then.
- NY_Entrepreneur 15y ago
  Even if the roulette ball drops into the slot 00, the play was still a "big risk", and so was, under the circumstances, insisting on a cofounder. That is, given how much Drew had already done, a cofounder had to be mostly just downside risk. The 'mitigation' had to be minimal. Or, Drew's left hand doesn't fight with his right hand, but cofounders can easily fight. If a cofounder is really needed, then so be it. But a cofounder is always risky, and a single founder who has already done well starting the business has a big advantage just because his left hand won't fight with his right hand. Now a single founder can do much more than in past years, even just five years ago. And here's a big point: always in a startup very much want the CEO to 'understand his business'. In an IT software startup, that includes understanding the software. But software has now changed: E.g., with .NET, nearly everything needed in commercial computing, and a larger fraction of Web site construction, is already in the .NET classes. So, the work is just writing a little 'glue' code between the uses of the classes. So, the coding goes VERY quickly. But what doesn't go quickly is understanding the classes because need about 10 books each of 500-1000 pages and, even for just a Web site, about 3000 Web pages of documentation from MSDN. And, this understanding of .NET is just 'overhead' that have to pay just once per programming task solved with a .NET class actually understand well. So, to 'know his business', a CEO needs to know the relevant parts of, say, .NET. A cofounder can't help here. And once the CEO does have that .NET knowledge, there can be some serious question if a cofounder can add much. Just what the Linux world has in place of .NET I don't know, but it can't be both small and effective. There is other evidence: Look up and down Main Street at the successful businesses that have been started there. Typically there's only one person who is the real 'founder'. Look at research: Bright ideas come first to just one person at a time. Period. Microsoft: A Bill Gates show. Apple: A Steve Jobs show. Berkshire: A Warren Buffett show. Renaissance: A James Simons show. Continue with the one man shows of Kolmogorov, von Neumann, Knuth, etc. and in music Heifetz, Rostropovich, Tchaikovsky, Beethoven, Mozart, Bach, etc. It's tough enough to find a Michelangelo to paint the ceiling. Getting him a 'copainter' who would actually help would be impossible. As you add people to a team, the team regresses to the mean where you don't want to be. And, did I mention fights? Sorry 'bout that.

bradhe 15y ago

The people who are most upset about the single founder rule are the people who were rejected by YC because they couldn't find a co-founder.

llambda 15y ago
Or perhaps people who thought they had a good idea or project and then took on a second founder in the hopes of getting into YC but then found that the person didn't work out.

DodgyEggplant 15y ago

A co-founder is also the minimum social proof. Find at least one person in the world who is willing to bet on you and your startup.

sunnydaynow 15y ago
Yeah, right. You forget: That is easy in college, but actually much more difficult later in life when all your friends have jobs and family. In other words, works in some way as a nicely worded age discrimination. Not that it affects me, but getting older makes you more sensitive for these things ;)
- deleted 15y ago
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- ig1 15y ago
  You presumably know far more professional developers at a later stage of your career than someone fresh out of university, so you have a far bigger pool to find someone out of. Most of the people who are just finishing university and getting into YC aren't people who would be struggling to find jobs, these are people who are choosing to work for a startup over going to work for Google or Goldman Sachs for a six-figure salary. The fact that someone older is more likely to have a mortgage and family commitments and thus be unable to relocate for three months and give up their salary is far more likely to weed out older candidates than the co-founder requirement.
  - sunnydaynow 15y ago
    The 25-year old knows that if his startup fails he can easily find a first (or new) job at Google etc two years later. That does not apply to 45+ year olds. The risk is much higher.
    - ig1 15y ago
      I don't get this, presumably by that point in their career they'd have a huge network of people they've worked with in the past and who would be eager to hire them ?

joshuamerrill 15y ago

As a single founder who's about to close his seed round (and was rejected from YC), I'm deeply concerned that opinions toward single founders are devolving from aversion, to bias, to self-fulfilling prophecy. With every step, investors are forfeiting the ability (or inclination) to evaluate this issue on the merits. I personally have no trouble working with others, nor difficulty enrolling others in my vision. I am extremely emotionally stable—I don't take things personally and have little trouble riding the ups and downs. I acknowledge that there are benefits to a cofounder that I'm missing out on (as well as drawbacks I'm avoiding!), but simply put, it's disappointing to see many investors marching lock-step to the beat of someone else's drum.

CamperBob 15y ago
I personally have no trouble working with others, nor difficulty enrolling others in my vision. I am extremely emotionally stable—I don't take things personally and have little trouble riding the ups and downs I'll leave the HAL 9000 jokes to someone who can afford the karma hit...
dmk23 15y ago
I take a very simple perspective on this "single founder aversion". If some investor is going to ignore my traction and business just because I achieved it without signing on a token co-founder, then frankly it is their loss and I won't hesitate to politely tell them that. By definition getting to the same results without co-founders requires a much higher level of ability than if being part of a "collective". Any investor failing to recognize that is going to miss out some of the best deals and that is really their problem. The main focus should be on pleasing customers and partners and if you do that right, eventually the right investors come along (with better terms too). Much better approach than to structure your company solely to please investors and forget what the business is all about. You might even end up with a business making money and no investors to answer to (or at least investors not having significant control over you). What a terrible thing! PS: Quite a few people promoted to "co-founders" should really be employees with accountability for specific tasks and projects, not an open-ended license to call the shots.
- 15y ago

phatbyte 15y ago

I'm also a single founder, and I'm investing part of my own money that I've been saving from all these years as a developer. Being a single founder is hard, you have to deal with everything from incorporating, accounting, writing code, design, worry about SEO, how to introduce your project to the world get some momentum, etc.. Plus, add that to the fact that I'm from Europe, VC is very complicated here. But because it's hard we should be more appreciated and not put aside. I'm working on it for at least 3 months now and it's 90% complete, I've been able to keep motivated and I've learned lot along the way. I just felt that this was the right path to go for me, I didn't feel the need have someone as a parter on this. I may be wrong in a long run but for now I'm pretty satisfied with what I've done. Obviously I don't agree with YC rule here, I understand some of their view points , but not everything is true or false. Some great projects maybe aren't being looked into because of the single-founder rule. But then again, you don't have to apply to YC or any funding, try something else, or simple bootstrap you idea and see how it goes.

DaveChild 15y ago
> I'm working on it for at least 3 months now and it's 90% complete Good luck with the other 90% ;)

NY_Entrepreneur 15y ago

On 'the rules': Again, just a fast look at VC finances shows that VC just MUST hit 'home runs' such as Dropbox or better. Then just a fast look at the history of home runs shows that get only a few each decade. And just a fast look at those home runs shows that a significant pattern is super-tough to see. And, any such pattern has only a few examples because the larger 'circumstances' change so much from one decade to another. E.g., it used to be that a trillion bytes was a REALLY large chunk of hard disk space, but now it's not so large just as main memory. So, since have to be looking for such home runs under such circumstances, what good 'rules' can be formulated? Remember, we're looking for home runs and not trying to find a description of a VCs average arriving e-mail pitch. Or we're looking for some tiny number of golden needles in in a huge pile of hay so that statements about some average about the hay are just irrelevant. Well, one could guess, 'the first rule of VC is that there are no rules', but, actually, that is too strong. But not good is the rule against 'single founders'. Why? With the larger circumstances today, a single founder has some big advantages. I will let readers fill in some of the advantages based on current circumstances just as an exercise! Next, for 'the rules', there still are some that can apply to some of the startup candidates, One collection of such candidates is based on startups where the core 'secret sauce' is especially powerful and can be evaluated just technically. For a biomedical analogy, consider a safe, effective, cheap single pill cure for any cancer: Then just evaluate the pill and f'get about the founder because if do have the pill and if he did invent it, then f'get everything else about him! He invented the pill, for god's sake! Or, we know you are plenty smart, but could you have invented that pill? So, if he's smarter than you, then you've just gotta think that he's plenty smart. I mean, given that he invented that pill, what are the chances he's a doofus? Or, to be quite specific, even worst case, just what issues of 'business acumen' couldn't be solved by hiring him a COO, CFO, SVP Operations, SVP HR? And there's no good reason to suspect such a worst case or even a bad case. Or, did I mention, the guy invented the pill? For meaningful rules to apply to all IT startup candidates, that seems to be asking too much. The simple answer that will fit on the back of the usual 3 x 5" card of VC rules that even a VC can understand is, in looking for the crucial home runs, the first rule is there are no rules.

0x12 15y ago

The downsides to having no co-founder: - you get to deal with the stress on your own (or maybe you have a supportive spouse) - you can't have soundboard sessions with your co-founders - you can't divide the labor - you have to have a lot of expertise in a variety of fields - if you get ill early on it will likely kill the company - nobody will call you out when you're spouting nonsense - likely a long long list of stuff following these The upside (and it's a huge upside) - you don't have to deal with your co-founders That one single factor does not outweigh the other ones but it is much better to have no co-founders than to have the wrong co-founder. And you can't really know in advance if you have the right co-founder or not. You'll know when you are in your first very heavy weather but by then it is too late to easily switch. That's why even if having co-founders is good plenty of people chose to go it alone, and end up hiring what would have been co-founders as early employees once they've established a certain level of success. If having no co-founders was a guaranteed fail nobody would do it, but plenty of people get by just fine to prove that it is not a hard and fast law, but more of a statistical issue.

maratd 15y ago
I started a business in college, by myself, and it had revenues of about 6 million by the time I hit 25. I'm now 30 and on my second business, which I also started and am now running by myself. Why don't I elaborate on some upsides to your little list? * You are the only one. That means if something goes wrong, you can't shift the blame. Not even subconsciously. It's always your fault. This guarantees problems get fixed and they get fixed fast. * You are the only one. That means you don't have to get approval or dilute your ideas. It gets implemented. Now. If you're spouting bullshit, the market will filter and you will adjust, fast. * You are the only one. You have to do everything. That means you understand every aspect of your business, because at some point, you did it. This helps you make effective decisions. * You are the only one. etc etc etc You get the idea. I can go on forever and you can go on forever listing wonderful things about co-founders. One way isn't better than another. They are different and the path you take depends on your goals. If your goal is to build a business that grows into hundred-million+ entity so you can cash out or where you can garner a cult following (i.e. Steve Jobs/Bill Gates/Larry Ellison/etc), you need a co-founder. On the other hand, if you want a business where you can pour your unmitigated passion into, where it becomes a place that not only supports you, but where your ideas take form, a co-founder will just get in your way. To dumb it down, if the #1 goal on your list is money or status, bring somebody else on. You won't be able to compete by your lonesome. However, if the #1 goal on your list is the freedom to do things the way you want to do them ... the only way to accomplish that is to remove as many obstacles to that as possible. That means no co-founders, no investors, none of it. A structure where you don't have to check with anyone before you do something. This, by the way, explains why most investors are completely against companies with no co-founders. It's not in their interest. The goals of the company do not align with their goals.

endeavor 15y ago

Are there any good examples where a single founder made it big, truly on his own? You can imagine that maybe Drew could have done it without Arash, or Gates could have done it without Allen, etc. But they didn't, which validates the exception. So before we casually say /oh if you don't feel like you need a co-founder then don't bother/, it would be good to know if any single founders have been successful. And maybe we should define success as financial/market success, not emotional fulfilment or getting your first two round of funding.

sajid 15y ago
Some examples of successful sole founders: Aaron Patzer (Mint), James Dyson (Dyson), Pierre Omidyar (eBay), Jeff Bezos (Amazon), Bob Parsons (GoDaddy), Craig Newmark (Craigslist)