What does it take to be a great founder?What should I look for in a cofounder?How do I get people to join my company? What should I do if my cofounder isn't hitting the bar?When is the right time to go full-time?How do you get great people to commit to your company?How should I handle equity split for cofounders?Should I give advisors equity? How much?When is the right time to fire someone?Is it worth pursuing partnerships?What is the role of the CEO?How should you prioritize your time as a CEO?
"[Relentlessness] isn't enough to make things go your way except in a few mostly uninteresting domains. In any interesting domain, the difficulties will be novel. Which means you can't simply plow through them, because you don't know initially how hard they are; you don't know whether you're about to plow through a block of foam or granite. So you have to be resourceful. You have to keep trying new things. Be relentlessly resourceful." - Paul Graham (Read: Relentlessly Resourceful)
"Determination has turned out to be the most important quality in startup founders. We thought when we started Y Combinator that the most important quality would be intelligence. That's the myth in the Valley. And certainly you don't want founders to be stupid. But as long as you're over a certain threshold of intelligence, what matters most is determination. You're going to hit a lot of obstacles. You can't be the sort of person who gets demoralized easily." - Paul Graham (Read: What we look for in founders)
"Choosing a co-founder is the most important decision you will make when starting your company. Your co-founder(s) will be like your spouse - you will spend most of your time every day with them, and you will need to agree with them on all the big decisions (what product to build, how to launch it, whether to sell the company...)." - Elad Gil (Read: How to choose a co-founder)
"Loyalty and ease of communication actually matter more than just raw intellect."
"Try to spend more time on the other shared interests outside of work. I think that'll help them make that irrational decision to go do a startup."
"A. Is this something you can work out? Every founder relationship has its problems. Can this one be fixed? Have you given feedback to your co-founder before? How did they react? Sometimes having a series of frank conversations is the best way to fix things. Do not proceed to step (B) unless you have had a few frank, non-emotional conversations with your co-founder about the issues. B. Who should leave? If this situation can not be worked out, which co-founder should leave? Should you resign? Or should one or more other founders be asked to leave?" - Elad Gil (Read: How To Fire A Co-Founder)
"I would document this stuff pretty aggressively." "I think it's worth giving it a go if you can find or design a new role for them for a few months. But you should time-box it and assume that it won't work out."
"I'd think about it a little bit less from a numerical standpoint, and a little bit more from an enjoyment standpoint. If you find yourself thinking about it in the shower, then commit yourself full-time to it."
Daniel Gross, office hours (video)
"The real key is trying to deeply understand what it is the person wants and whether you can actually deliver on that."
Claire Lew, AMA (video)
In most cases, an equal equity split is correct. All founders should vest their equity.
"Founders tend to make the mistake of splitting equity based on early work. Equity should be split equally because all the work is ahead of you." - Michael Seibel (Read: How to Split Equity Among Co-Founders)
The situation can sometimes be more complicated.
"You need to do whatever is going to make the other person feel good and you feel good."
"It's really case specific. You should just do whatever makes people feel happy and satisfied and err on the side of being generous than not."
It's often possible to build strong informal relationships without issuing equity. Having potential advisors invest small amounts as angel investors can also be quite useful.
"There are some people that are just motivated by interesting problems, so they'll care. On the margin, I've found [giving equity to people I look to] often doesn't work out. The early angel investor thing really does work out. You need to figure out what motivates them."
If you decide to issue advisor equity, a fraction of a percent vesting monthly over a 1-2 year period is common (see this guide from Carta).
"Once you let a low performer go, you will frankly feel a wave of relief. If you wait too long, the team will form strong relationships or friendships to the underperforming employee, and letting the person go will be even more jarring to the people left behind. You need to act quickly and decisively. Typically, if you are a first time manager, it will be well past the time you should have taken action that you actually decide to take action. There are always excuses and reasons not to do the hard thing." - Elad Gil (Read: When & How to Fire an Employee at a Small Startup)
"Either one person doesn't have a job or nine people don't have a job. If you lower your standards, the whole company's going to go under."
Daniel Gross, office hours (video)
"I made this mistake in both startups I've started – I pursued partnerships aggressively. It took forever and it really amounted to nothing."
"The CEO is responsible for three things: 1) The CEO is manually responsible for doing whatever the company is not good at, until you can hire someone to do that, 2) the CEO is responsible for injecting into the business a real sense of purpose and mission and setting standards, 3) the CEO is responsible for tempo. Tempo is the main thing that separates the great startups from the bad ones. That's kind of, I think, most of Elon's genius. He's really smart, but what's more important is he's extremely impatient."
Daniel Gross, office hours (video - private to Pioneers)
"What are your thoughts about hiring people to do freelance before doing it yourself?"