Do you need a co-founder for your Micro Startup?

The pros and cons of having a co-founder

This is a crucial lesson. If you make the mistake of having the wrong co-founder, you might waste years in your startup journey. This lesson will help you decide if you should build a Micro Startup with a cofounder or not.

Whatever I am sharing here is from my personal experience. Learn from my experience and decide based on your beliefs, knowledge, and convictions. There are no written rules when it comes to making decisions like this. All I have to offer you is my perspective based on my experience.

Partnerships are tricky, both in life and business. If you are getting married, there is no such thing as a perfect spouse. There will be conflict, differences in opinion, and friction. The emotional, social, and financial cost of breaking a marriage is insanely high. Compared to a marriage, the cost is relatively less in breaking a business partnership, but it can still be difficult.

If you have a cofounder, you will have ups and downs with them. You cannot expect smooth sailing. Sometimes, such friction is needed for growth, but often it is unnecessary. It depends on the goals and purpose. You have to review if it is worth it to go through that friction.

The most challenging type of partnership is a 50/50 partnership. Such partnerships work well if they work, but in 9/10 cases, the partnership breaks in 3-5 years. I have personal experience in this and have seen many others go through the same.

We have plenty of examples of multi-billion dollar companies that have 50/50 partnerships. One example is Google. Sergey Brin and Larry Page have almost equal equity in Google (Alphabet). But they are exceptions, not the norm. In India, I can think about Razorpay having two cofounders with equal shares in the company.

Equal partnerships generally form at a very early stage. People come together when they are in college or just out of college. They have nothing to lose when they start from scratch. There is a lot of excitement and they do not see the potential problems in the future.

A husband and wife, who don't get along very well, stay together for the sake of kids and social pressure. The marriage goes on for decades. That doesn't mean that they are perfect for each other. They might be forcing themselves to stay together.

People grow in different ways and life preferences change as you grow. It's a lot of work to keep it together. Most people do not achieve much in life because they are constantly pulled down by the demands of the relationship.

Similarly, once a company grows to a level of maturity, business partners stay together because no one wants to walk away from the economic engine they have created. There is more to lose than to gain. If investors are involved, they will insist that the partnership stays, just like relatives insist that you cannot let a marriage fall apart.

Life can get very difficult when cofounders do not align with each other and it takes away a lot of mental peace and freedom. In the past 7 years of running different companies, I've had 3 cofounders. Each lasted 2-3 years and it was becoming too difficult to align on values, decision-making, and long-term vision.

I felt it was not worth it because the purpose of the business, especially a Micro Startup, is to give us freedom and flexibility. We don't want to go through many challenges for an end goal. We want to enjoy the journey.

For these reasons, Micro Startup, the company that I incorporated in 2024, has only one founder, yours truly. I have the majority stake (99%) and I control all the decisions in the company. I will be retaining the freedom and flexibility that I have right now well into the future.

I will be setting aside some equity for employees as the company grows. I might sell some equity to investors. I might go public. But I will always have the majority stake and voting power for the decisions in the company. We have plenty of examples of trillion-dollar companies that have a solo captain.

Meta (Facebook) is primarily controlled by Mark Zuckerberg. Though he doesn't have 51% or more equity in the company, he still has the majority voting power and helps them make intuitive and fast decisions without being delayed by other stakeholders. One such example is the decision to buy Instagram and WhatsApp. Zuck saw the future, made the decision, and got it done.

Amazon by Jeff Bezos, Tesla by Elon Musk, Dell Technologies by Michael Dell, Salesforce by Marc Benioff, and Oracle Corporation by Larry Ellison are all examples of single founders building something very big.

Apart from Google, it's difficult to find examples of trillion-dollar companies that have equal cofounders. Bill Gates and Paul Allen co-founded Microsoft, but it was not an equal partnership.

Paul Allen initially agreed to a 60–40 equity split with Gates, which later became 64–36. This decision strained their relationship. Most people don't even know Paul Allen. Apple was initially co-founded by Steve Jobs, Steve Wozniak, and Ronald Wayne. Steve Jobs later became the dominant force behind the company.

Wanting to be a solo founder is not about ego. It's not like I want all the limelight if my company becomes big. It's about making the process of building a company smoother and fun. My needs will be unique. At some point, I might want to slow down the growth of the company and take a 3-month vacation.

If I have a co-founder who is a workaholic, then I will have a problem there. He might not agree with the idea of me taking a long break while he continues to put too much effort into the growth. I might feel guilt-tripped into working harder than I have to. And this can happen the other way as well.

What if the cofounder gets married, has kids and his life priorities change? If his focus on the work goes down and I am continuing with my focus, then I would feel like his equity is dead weight.

There are just too many moving parts in a company and it's just difficult to manage a cofounder relationship. Considering that I am not hell-bent on building the next Google or Apple, I am ok giving up the idea of having an equal partner. It's just not worth it for me.

I also do not recommend partnering with friends or family members. I know some people who are married and also are co-founders of a company. I have no idea how they make it work.

I prefer keeping work and family separate. Family supports work and work supports family. Family cannot become work and work cannot become family. There will always be exceptions and exceptions cannot be the norm.

You might feel like I am a control freak. I am not. I give plenty of freedom and work flexibility to my core team members. But there can be only one captain of a ship. The responsibility and accountability for the growth and safety of the company has to lie with one person. Else it just becomes too complex to manage.

Y-Combinator, the world's No.1 startup incubator defines a co-founder as someone who has at least 10% of equity. No law defines who is a co-founder. It's a tag that is given out of respect and only serves as a perception.

Once you start building your startup and in the future, you want to get a co-founder, it's not impossible. You need to show some traction to convince someone to become a cofounder.

You can give 10% equity to someone like a CTO or COO but only after they have worked for at least 4 years in your company and you feel like you cannot let them go. An equity in the company will make them feel like it's their own company and they will stay and build it with you long term.

Having said this, it's up to you to make the final decision. I hope my experiences have given you a good framework to decide for yourself.