Founder red flags, before starting up

I got a late night call from a friend last week.

He had been offered the opportunity to co-found a startup.

His prospective cofounder has a great track record, having grown his last business to 100+ venues and replacing himself with a management team.

My friend has complementary skills for the opportunity and has also built a great business of his own. He is seeking variety for intellectual stimulation and would feel more financial security if he had a secondary, non-correlated revenue stream.

We walked through the details of the offer, which I’ll keep anonymous here.

The opportunity ticked a few boxes, but there were a few red flags too.

One immediate call out he made was:

“…he’s a great business guy, but he really likes the sound of his own voice...”

Hmm…

So, I posed a few questions to him. 

The questions were not anchored to the opportunity, but his goals as a founder. I like to work founder-out, not opportunity in. The assumption is that the founder is capable enough to make any given opportunity succeed.

This framing helps the founder get clear on what they might learn, rather than compare opportunities side by side. 

This is important because the tail can wag the dog, where the opportunity drives the founder, rather than the founder pursuing an exciting opportunity.

I learned the pitfalls of this with my first company. I should have been more excited about the category overall, as I was easily distracted and started multiple other projects while the original startup was doing just fine.

Here’s a sample of the questions we dove into:

• Could you see yourself working with this person for 50-60 hours a week for the next few years? If yes, how do you feel about that?

• Would you be happy to put your friendship at risk if you took this opportunity on?

• How do you think this opportunity will help you grow?

• Would this be the highest and best use of your time, given the other known opportunities you could pursue at this point in time?

• What held you back from an immediate, emphatic yes?

These are great questions to consider as you’re starting out. 

If there are any questions you wish you had been asked, pre-startup, please reply and let me know.