Startups

Why you may need a co-creator more than you need a co-founder

  • 3 min Read
  • July 21, 2022

Author

Escalon

Table of Contents

Entrepreneurship conjures images of a satisfying work environment where you are your own boss, and there is nobody quizzing you about deadlines or details. Although it is portrayed as a utopia, entrepreneurship comes with its own challenges and trials. 


To achieve their dream of launching a startup, many entrepreneurs bring on a co-founder under the assumption that doing so is a safer bet than going solo. But the reality is that a co-creator may be more beneficial to a startup than a co-founder. Below we’ll delve further into this proposition, starting with a look at how entrepreneurs might otherwise find support for their venture.


Patrons



A patron could be anyone who has an interest in your business, such as friends, family or acquaintances, and who helps without an expectation of monetary compensation. Patrons may provide money, advice or networking connections, or give support just choosing to be your customer. By being in the right place at the right time, patrons function as a security net for aspiring entrepreneurs.


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Agreements



Not all entrepreneurs have connections who can provide the help they need. If cash flow is lagging, a business owner may decide to pool expertise by finding a company that complements their unique selling proposition. If an agreement is struck, the companies can benefit by tapping into each other’s USPs. For example, both entities could gain access to the other’s products without diluting their equity.


Employees



Founders who can afford to hire employees can forgo bringing on a co-founder. In this scenario, employees can function as pseudo-co founders without laying claim to the business’s equity or profit, and without the risk of a big showdown between founder and official co-founder that so often happens. 


Co-founder versus co-creator



Many industry experts, but not all, argue that co-founders are essential to win the battle of launching a successful business. However, as many as 43% of founders are compelled to buy out their co-founders over disagreements and power disputes, just to keep the business from imploding.


As an alternative to appointing a co-founder, the people providing entrepreneurial support (but not in a co-founder sense) — patrons, partners and employees — can act as co-creators and become the de facto team to help founders execute their vision. 


The possibility of founder and co-founder power struggles, creative differences and simmering resentments suggest that if you are thinking of going it alone, you need to surround yourself with a team that is in tune with you. All you expect is their support, not a co-founder who initially provides support but later expects you to bow to their whims.


Remember the messy, multibillion-dollar split between Mark Zuckerberg and Eduardo Saverin? Let that be a guiding light in deciding whether you need a co-founder or co-creator.


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Since 2006, Escalon has helped thousands of startups grow faster with our back-office solutions for accounting, HR, payroll, insurance, and recruiting and taxes — and we can help yours too. Talk to an expert today.

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