Why investor require start-up having a co-founder?


3

I contacted a lot of investors and accelerators. I found most of them don`t care about the product itself too much, but strongly requiring start-up should have a co-founder.

Why?

Perhaps some of founder themselves don`t know about programming or designing, so they may need a co-founder like CTO to responsible for that.

But what if the founder is good for both programming and designing skills and more, managing the start-up petty by one person?

I think finding or hiring an excellent A-player co-founder and employee is hard and impossible for start-up in early stage, but it may be possible after the start-up received funds from investor.

Getting Started Co-Founder Investors

asked Dec 15 '12 at 09:26
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Anlai
375 points

3 Answers


6

It's the chariot technique.

One horse has a lot of flexibility. It's not that hard to turn, you can vary the pace if you get tired, you can stop to graze if you're low on resources (consulting, day job, etc.).

If you hitch two horses together, you give up a lot of flexibility, but you gain focus. They have to keep up with the team, and with the pace set by the driver. They have to run towards the goal set when they start out. While they can still turn, it takes a lot of coordination, so they're only going to do it if it will improve their odds of a win.

Investors need a predictable model for maximizing the odds of success. A team has much better odds of single-venture success. It also has much better odds of generating a win on the scale which matters to investors. If you want to do something which has effects on this scale, teaming up and going VC will vastly improve your odds of success.

Going it on your own can be a great strategy in terms of optimizing for long-term success on a more modest scale. Since for an individual, the level you want might be "enough to live on a beach in south-east Asia" - the bar is much lower. This, assuming you have a very diverse skill set or the ability to hire for gaps, and the motivation to keep going without a co-founder or investors to egg you on, and the bloody-mindedness to keep trying after a number of failed attempts (etc. etc. etc.).

answered Dec 15 '12 at 10:56
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Jim Gray
261 points

1

I'd be surprised if the didn't care about the product. They may not care to go though the details without seeing that a team is in place.

Consider this: They are placing bets on whether their investment will produce returns - and betting on a single unproven person is likely too risky for their model.

Sure, you can go it yourself - but having another founder / partner requires you to articulate your vision, defend / collaborate / combat issues (both internal and external) to help your company grow. Some investors operate on the premise that if you cannot attract the proper talent to join your cause you don't have a compelling enough effort (or lack the prerequisite skills to to sell it).

answered Dec 15 '12 at 10:39
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Jim Galley
9,952 points
  • Some of VC and investor proactively contacted me with warmly welcome because they seen and thought my product was good and look like a team-made, but when I told them this product is I make alone without team, they stopped contacting me anymore:( – Anlai 7 years ago

1

A few reasons that I've observed.

  • It produces a fragile company. Which means more risk for the investor. If a single founder loses interest - or god forbid has some kind of medical issue or dies - then the company is toast.
  • If a company is worth investment it needs to grow. That will involve more people. That involves having the people running the company being able to manage people, delegate, etc. By having a co-founder - or even better a team - you demonstrate that you have those skills.
  • It is rare - very,very rare - for a single person to be as good at dev and design and business as somebody who specialises in just one or two. I do all three too - but I'm better at some than others. I'm very aware that I fall short in some aspects of all three. Not everybody knows what they're bad at. Having a co-founder or a team demonstrates that you do.
answered Dec 15 '12 at 18:35
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Adrian Howard
2,357 points

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