Ignore These 5 Founding Team Principles At Your Own Peril

I think I’ve written more than a few posts on founding teams already. I can’t help it, because it’s just SO FREAKING important. This very first step will make or break your startup.

A huge part of my work now is assembling founding teams. Of course, I’ve had successes and failures. As usual, the failures have taught me much more than the successes. From what I’ve learned, here are more detailed principles I now live by when it comes to founder selection.

Ignore at your peril.


Founder DNA should match Company KRA’S.

Once you identify the 2-3 main strategic areas your company will be involved in, find founders who can fulfill EACH area. Are you starting up a mobile gaming firm? Then you need someone who designs great games, someone who makes great games, and someone who can sell them. If you are all three, then you can actually put one up on your own. There’s a very good chance that you are not though, so fill the gaps with co-founder or two. (I highly suggest keeping it to 3)

“Why can’t we just hire someone for the gap?”

The answer can be very practical. Because that someone who is hired can leave. If the person leaves, and is occupying a position of strategic importance (say, you hired a person who will develop your games), then your whole company gets stalled. If the founders are selected strategically, then one partner can always fill the gap of whoever employee leaves.

This is one secret why STORM works. The whole soul behind STORM is HR and IT. So over the years we’ve lost IT team leaders to Singapore, or lost internal HR Consultants. Whoever leaves, either Pao (founder, IT guy) or I (founder, HR guy) can take up the slack, so no time is wasted.

This way, you ensure that the DNA of your startup will always be aligned to its core objectives.

2) NEVER Compromise on a Founder

This is corollary to the first one. Sometimes, we get too excited with working with our friends or we get too excited about starting that we end up partnering with the wrong person.

We can delude ourselves into thinking thoughts like:

Hmmmmm…this guy isn’t as impressive as I had hoped, but he’s close enough


This person is just okay, but I do think I set my standards too high in the first place anyway. He should be able to do the job.

No, he won’t.

NEVER compromise. Don’t talk yourself in doing so. Keep on digging. Believe me, you’d much much rather get delayed than selecting the wrong person.

QUICK TIP: 3 things to seriously ask yourself: a) CAN he do the job? (capability) b) WILL he do the job (motivation) c) DOES HE HAVE TIME to do the job? (bandwidth)

That guy you selected COULD’VE BEEN this guy instead

3) You can only gauge talent in your own DNA sphere

Scenario: you want to fill a founder post with someone with a programmer background. “I want a great programmer,” you say to yourself. Then some person comes in and shows you some stuff he’s made. It works. You’re impressed. It’s easy to mutter to yourself, “This guy’s great!”


I liken the above to this scenario: let’s say you’ve never watched football in your life. You could watch some schlub in the local soccer field score some goals (maybe one with a bicycle kick) and say to yourself, “Wow, that guy is an amazing player.” And then, a few days after you get to watch Lionel Messi play. NOW you know what “great” is.

Tip: in situations like this, ASK someone who is knowledgable about an area who can discern “great” from “mediocre.”

4) You have to have someone fulltime

I guess it IS possible for a startup to begin standing on its own two feet with all of its founders doing it part-time. This is just impossibly difficult to do, I’ve found. Without someone in your founding team who can put on the hours your startup sorely needs, it’s very difficult to pull off. The most valuable thing your startup needs is not funding, or a killer strategy – the most valuable thing it needs is great people spending time on it.  

Even if it’s just one founder fulltime. You got to have someone who commits, right from the start. If not, development will be slow as hell, and somewhere down the line, your momentum and/or motivation just wanes.

This happens no matter how utterly magnificent your part-time founders are.

Don’t make equity room for these two

5) Get rid of pure talking heads

Never give substantial shares (or any shares for that matter) to people who will only assume what I call the “talking head” role. Someone who says he’s in it for merely “the strategy part.”

What characterizes the “talking head” is his lack of arms and legs – he won’t do anything. He just presumes he’s worth the equity because of the sheer “knowledge and wisdom” he will impart.

Resist his wily charms. You need DOERS who will contribute. Get DOERS who can multi-task and think as well.

You CAN, however, get these guys as mentors. It’s almost 100% they’ll agree.

Do these right, and it’s literally half the battle.

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Peter Cauton

Entrepreneur, writer, speaker, startup advocate, HR guy. Husband, father of 6, teacher, unabashed follower of Christ.

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