In this podcast, Étienne Garbugli and Sean K. Murphy discuss critical aspects of co-founder disagreements and those at a team level. They believe that most disagreements can be managed to yield productive insights, more effective plans, and a working consensus on a problem or challenge.
Time to Market Podcast S01 E07:
How to Learn From Co-Founder Disagreements
Summary: Etienne and Sean cover critical aspects of co-founder disagreements and those at a team level. They believe that most disagreements can be managed to yield productive insights, more effective plans, and a working consensus on a problem or challenge.
Edited Transcript with Hyperlinks and Section Titles Added
Sean K. Murphy: Today Etienne and I want to discuss disagreements between founders or at an executive team level. We want to explore how to use them to get insights and reach a working consensus on a problem or situation, generate options to be considered, and develop a plan of action to address them. Our opening quote from Herbert Spencer: “Truth generally lies in the coordination of antagonistic opinions.” Which certainly fits a lot of startup team conversations I’ve been a part of.
Étienne Garbugli: You’re trying to get that one plus one equals three by integrating diverging opinions. What does this say about the “Jobs to be Done” for a co-founder?
Sean K. Murphy: You should work with people when the two of you get more done or bring more to a problem or a situation than either of you working independently.
The primary reason to collaborate is that you get more done. For that to be possible, normally, two conditions have to hold. First, you must have a core of shared values and an agreement on where you’re trying to go. Second, you must bring different complementary skills, experience, or expertise to the problem.
Étienne Garbugli: So, there need to be different perspectives or contributions that add up to more than a solo founder could achieve?
Sean K. Murphy: Yes, for example, if you see two deeply technical people that are both masters of Kubernetes doing a Kubernetes-related startup, they are likely to cover the technical aspect of the problem well. But the other two-thirds of what’s needed to succeed may be a mystery.
Étienne Garbugli: They may be missing key expertise related to sales, marketing, and customer support for example.
Sean K. Murphy: So you’ve worked with co-founders in several of your startups, what was your motivation inviting them in early?
Étienne Garbugli: Some of it was due to the idea that a startup benefits from multiple co-founders. That was heavily promoted initially, and it’s only recently that some entrepreneurs have been making counter-arguments about the advantages of being a solo founder.
Getting funding and building a solid team can be easier if you start with two founders. I’ve been in a variety of situations: good co-founders following a bad idea, poor co-founders following a good idea, and the ideal where you have good co-founders pursuing a good idea.
My first startup was not my first rodeo: I’ve played music for years in bands and seen what it is to be in a creative environment where different people are trying to achieve similar goals. That’s always very hard. I learned that finding the right fit, where everyone was working toward the same goals and in sync on how to get there, meant that differences in opinion don’t sabotage the team’s ability to create shared achievements.
Lessons from Rush
Sean K. Murphy: I’m a fan of Rush, which I assume you can appreciate being Canadian. What I find most impressive about the three core musicians is that they came together in their mid-teens and played together for 50 years. And they keep creating hits.
Étienne Garbugli: If you have seen their video interviews, it’s clear they are still very good friends. That’s amazing, especially in contrast to a band like the Rolling Stones, who seem to view themselves as business partners, but would probably rather be anywhere else than in the same room with the other members when they don’t need to be.
That’s two very different sets of working relationships. The best outcome is to do multiple startups with the same person or team and have this respectful and evolving creative partnership.
Sean K. Murphy: In the beginning, you need someone on the team who is committed to excellence but who may also be something of a micromanager. Because there are so many things that can go wrong, getting the recipe requires this ruthless focus. But that person needs someone to say: I think you’re making a mistake. So, how have you seen co-founders keep each other honest and accountable?
Need Mechanisms that Separate Vision from Ground Truth
Étienne Garbugli: You need mechanisms that separate your vision from the truth of what is actually happening. It does not have to be a co-founder who provides feedback; it can be an external advisor or an advisory board. It can be hard to be objective, but you should separate what you believe the objective facts of the situation are from your opinions, assessments, and hypotheses. If you try to predetermine the advisor or advisory board’s perspective and recommendations, you lose much of the benefit of independent review.
One of the core benefits of adding a co-founder is you gain another pair of eyes and ears on customer and investor conversations. It gives you the equivalent of depth perception of opportunities and challenges.
What about you?
Some Early Customers Can Act As Co-Founders
Sean K. Murphy: I look at your early customers as providing many of the benefits of co-founders, especially early adopters who expect to work with you to co-create more value. Of your first 6 to 12 customers in B2B, typically, one or two of them will significantly impact your product direction or unlock other critical insights. Of course, gaining these insights requires learning to listen and compromise, which is also good practice in dealing with co-founders.
It’s a good idea to define areas of responsibility and budgets in terms of both hours and dollars. Put your agreements in writing, in plain English, nothing fancy, because we all tend to edit our memories and prior beliefs based on outcomes. Relying purely on memory slows down your learning and can lead to unnecessary arguments.
This also applies to commitments you make to customers and your co-founders. Entrepreneurs tend to be optimistic and promise according to our hopes, but making a commitment you don’t meet erodes trust.
Written Commitments Separate Hobby Projects From Serious Efforts
Étienne Garbugli: I think clarity on commitments frames the startup as more of a joint venture or an entity you’re trying to create as opposed to an artistic project, like a band. If your goal is establishing a company, writing your commitment down keeps everyone’s roles and obligations more in line with a full-time job than a project you do on nights and weekends.
You may start out only working nights and weekends as a risk management strategy, but asking for written commitments makes it clear to everyone they are signing up for something more than a hobby project. It helps everyone understand the goal is a serious effort at a new venture that may take the next ten years of their lives.
Asking For Permission Builds Trust: Unilateral Action can Erode It
Sean K. Murphy: One mindset I’ve seen that causes trouble in an early-stage startup is following Grace Murray Hopper’s advice, “It’s better to ask for forgiveness than permission.” If you take unilateral action in an area of shared or overlapping responsibility before you have at least a rough agreement with the others who are accountable, it’s likely to cause problems.
Hopper’s advice is fine when dealing with a bureaucracy that doesn’t care. If there is the equivalent of a fire in the building, there are better ways to work with co-founders, early team members, partners, or customers. Surprising people by not asking for their perspective and feedback rarely works. This applies especially to customers.
Étienne Garbugli: I really like your point about viewing early customers as co-founders or at least partners.
Creating that proximity helps you understand their perspective and their needs. It makes your business more sustainable because it’s more likely you will provide your customers with value. It’s critical to seek close collaboration with at least a few early customers because it will provide a lot of insight.
Sean K. Murphy: Disagreements can generate more heat and light. How do you ensure that you’re hearing the insights people offer in the midst of an argument about a strategy or a particular situation?
Introverts vs. Extroverts: Common Disconnects Can Be Managed
Étienne Garbuglli: If two extroverts are going at it, they will typically get the issues on the table. I think it’s harder when an extrovert interacts with an introvert or two introverts argue over email without speaking. It’s important to respect that there are two different modes of communication. Extroverts will share their incomplete thoughts and revise them in the same meeting. Introverts don’t like to share half-finished ideas and can find it hard to understand why extroverts do.
One thing I do when working with introverted co-founders is to spell out my view of the situation in writing and give them time alone to think about it and write down their perspective and perhaps a solution.
I then share all of these written perspectives with the team so that everyone can prepare their thoughts and understand everyone else’s perspective. If you don’t do that, then the introverts can feel like they are being invaded during a conversation. They may stay more quiet and not be as willing to share their thoughts or disagreements, which can create problems down the road.
Give people the time to use their natural mode of thinking about the problem and then allow them to present it without interruption. This will increase their objectivity and ensure that everybody feels heard.
Some, all, or none of any one person’s solution may be adopted. But if everyone feels heard, it’s less likely that disagreements will keep building and resurfacing in different contexts.
Sean K. Murphy: The introvert-extrovert split is significant, and your approach is a sound way to address it. Introverts don’t like pop quizzes, so your suggestion for written preparation helps prevent that. Introverts have this rich interior landscape, and it’s not so much that they don’t like to share their thinking; they don’t want to share half-formed thoughts. So an extrovert will blurt something out that’s clearly a bad idea in an effort to try and move the conversation along. There can e some value in that, provided they don’t defend it to the death.
I also want to pick up on your point about listening to people. Writing down the second, third, fourth, and fifth best approaches is never a waste. It’s valuable to capture everyone’s concerns and reasons why something may not work. Because when it fails in a few months, there is a big difference between “Why didn’t we at least anticipate this risk?” and “We anticipated this risk; why didn’t we do anything to mitigate or eliminate it? ”
And sometimes, you look back and say, “Knowing what we know now,” none of the top three will work. But the fourth or fifth idea might be viable. At a minimum, having some “bad ideas” prevents a cold start on the option generation process.
Phrases to Avoid: “My Idea” and “I Told You So”
Étienne Garbugli: There is a tendency when things go wrong to remind the team of your idea. Having a common list makes it more of a team idea that can be evaluated more objectively. If you can avoid the “I told you that would never work” and “you guys should never have rejected my idea,” you avoid a lot of negative energy spirals and bad mojo, where people start assessing who is to blame instead of asking “where do we go from here?” You decide, set a checkpoint for review, go to the next problem, and reassess your prior decision at the checkpoint.
Sean K. Murphy: I’ll offer a slightly different perspective. If you are a founder or an early employee, it’s your obligation to support a decision that’s been arrived at using an open process such as the one you outlined.
But as a part of that going forward decision, I think it’s reasonable to set not only a checkpoint review date in a few weeks or months–or days if you are in a lot of trouble–but also specify how you will determine if the plan is working.
What are early indications of success? What are early indications of problems? How much time should we give for the plan to work? And if we reach that point and have yet to hit these results, we will revisit.
You don’t want a team member to drag out a laundry list of complaints or “I told you so’s,” but it’s reasonable to write down evaluation criteria so that you don’t end up moving the goalposts.
Étienne Garbugli: I agree, provided you avoid framing it as “I was right and you were wrong.” That leads to a lot of trouble. If you are your co-founder or an early employee continually personalizes issues, you are on a slippery slope. If we are more concerned with who was right, that acts as a solvent on team morale, that’s very hard to recover from. Founders can almost always win arguments with early employees or other team members, but it’s not conducive to creative problem-solving at a team level.
John Morgridge, A CEO Who Had the Patience to Listen
Sean K. Murphy: I’m guilty from time to time of wanting to win the argument, of wanting to be correct. It’s very dangerous. I’ve seen this happen on sales calls, where after the call, someone on the team says, “I don’t understand, we won the argument, how come we didn’t get the sale?”
Co-founder collaboration matches how a startup team works with early adopters: a full and frank exchange of views.
I joined Cisco in August of 1990, six months after they had gone public in February. I reported to the VP of Engineering and attended several executive staff meetings over the next 18 months.
John Morgridge, the CEO, struck me as an introvert. One thing that surprised and impressed me was that he was quite comfortable letting his staff and other attendees at the meeting express their opinions. He would listen and then summarize what he had heard so that it was clear he had been paying attention. He would not editorialize; he would just say, “okay, here’s what I heard.” After everyone had a chance to speak and there had been some back and forth between competing perspectives, he would announce his decision.
Now, I don’t know if he came into the room with his mind made up, probably sometimes he did, but he gave a pretty convincing simulation of listening and allowing everyone to be heard. But his approach often allowed a working consensus to form so that even people who disagreed with the outcome–and there were few shy people among his direct reports–had to acknowledge they had been heard. They did not keep decision records that I was aware of or set checkpoints for evaluation, which could have saved some trouble. But they met with a fair amount of success for the next decade.
Étienne Garbugli: That sounds similar to Abraham Lincoln’s approach of tolerating a high-level disagreement in cabinet meetings. His servant leadership mindset allowed many different voices to be heard. He was okay with disagreements as they deliberated; he would then try to reconcile everything and make the best decision.
It takes a lot of confidence to listen to many different perspectives and take ownership of the decision. When are disagreements in a startup team harmful, and when are they helpful?
Avoid Contempt For Customers and Co-Founders
Sean K. Murphy: When contempt starts to sneak into interactions, that’s a severe problem. That applies to many kinds of business relationships: when there isn’t trust and mutual respect, that will block effective collaboration and creative problem-solving. The whole point of working on a team is to get more done than you can on your own. It won’t end well if you don’t trust your team members.
I quoted Herbert Spencer at the start of this podcast. He has another good insight that bears on this: “There is a principle which is a bar against all information, which is proof against all arguments and which can not fail to keep a man in everlasting ignorance-that principle is contempt prior to investigation.”
Trust and mutual respect form the demark between constructive and destructive disagreement.
Étienne Garbugli: This goes beyond business and entrepreneurship: any healthy relationship has to be based on the assumption the other person has good intentions. Anytime you suspect a decision might be different if the other person liked you, it’s trouble. At the end of the day, you must assume their intentions are good and based on objective criteria to maintain a long-standing relationship. You should not have to think about whether their heart is in the right place.
You have to allow for different perspectives and to distinguish their opinions from who they are as a person. Collaboration is much easier with people you have built trust with because you are very confident about their intentions and can focus on their proposed actions or strategies.
I’m sure the musicians in Rush disagreed a lot, but over time they believed in each other’s characters enough that they didn’t have to worry about bad intent. It became so you like this better, and I like this better, that’s fine.
The Plural of Anecdote Can Become Data If Managed
Sean K. Murphy: There are two significant divides in how people communicate or process information. We’ve talked about introverts versus extroverts and how extroverts think by talking out loud, which can lead to many poorly thought-out ideas and the occasional good ones. One hack I use in front of prospects is to write my potentially bad ideas down so that I avoid blurting them out.
The second divide is around concepts vs. details. Some people like to proceed from abstract concepts or an intuitive understanding; others are hungry for details and concrete specifics.
People will say, “The plural of anecdote is not data,” but I disagree. If you are more intuitive and someone gives you several counter-examples, you cannot dismiss them. You have to incorporate them into your model or hypothesis. It’s also helpful to collect stories related to a problem the team is facing, then try to develop an overall explanation or model. People can feel they have unique experiences, but it’s often the case that they are part of a large pattern that can form the basis for a guideline or decision rule, at least a tentative one. Asking for examples or stories is another way to help unpack underlying assumptions that team members may bring to the conversation.
So there’s this intuitive versus concrete barrier that you also need to span on a team.
Étienne Garbugli: There are different learning and thinking styles. None are necessarily wrong, just different ways to reason your way to a conclusion. There is value in having a plurality of thinking modes on a team. You overlook a lot less.
What are some signs you look for that a co-founder or team member is not going to work out?
Common Failure Modes: Excessive Ego, Greed, and Inflexibility
Sean K. Murphy: I’ve seen two situations. In the first one, the co-founder was not entrepreneurial and didn’t understand what they signed up for. You need to get to a team size where they can become more of a valuable early employee, or you’ve got a problem. That’s a painful one.
We must be careful as entrepreneurs; we tend to project our mindset onto people we meet, and often, it’s not there. It’s a different perspective from an employee, not better. Employees help society preserve what’s working, and entrepreneurs bring change. We need both.
The other one I’ve seen is where one founder drives things and promises to distribute equity but doesn’t. So the cofounder finds themselves a year or 18 months in and asks, “Hey, what’s going on here?” The founder says “I am in charge and not sharing.”
Étienne Garbugli: So a divergence in how they view the future or their roles in the future, and a disconnect in how the company should be organized. Probably more than a little greed in the latter case.
Sean K. Murphy: I think the second case is about control—and a desire to avoid any need for compromise or negotiation. I spent a day with two potential cofounders about 20 years ago; we were brainstorming about a startup we were considering forming. This was in 2002 or 2003. At the end of the day, my spider sense was tingling, so I said, “tell me how you feel we should divide up the equity?”
One person said we should cut it three ways, and the other said I should get 90%, and you guys each get five. In a rare moment of patience or perhaps white-hot fury, which I find strangely calming, I said, “That’s an interesting perspective. What is it that you’re bringing to the team that means you should get the lion’s share of this deal?”
And they knew this famous guy at Xerox PARC. So I said, “OK if you can immediately raise money in this environment–which at that time was nuclear winter in Silicon Valley–then I agree you get 90%. But if you can’t, then I like the other plan. We ultimately came apart because the second person realized they had an inflated set of expectations and didn’t know how to back down.”
Étienne Garbugli: There’s an element of ego and getting locked into a static perspective. It makes it hard to have a long-term collaborative relationship. Suppose your co-founder is flexible on things they don’t care about, like the name of the company, but inflexible on things they care about, like the equity split. In that case, the negatives will probably get amplified as you find success in the future.
A high level of inflexibility makes it very difficult to adjust your plans when they need to change. Adaptability in changing circumstances or failing plans is a crucial trait in a co-founder. If you don’t see that in a co-founder, it’s a very bad sign.
What have you seen work for entrepreneurs to resolve conflicts and have a successful working relationship with their co-founders?
An Effective Team Gets More Done Than Sum of Individual Efforts
Sean K. Murphy: It goes back to whether you can accomplish more together than apart. There’s always going to be friction and disagreement. Some of the latter will actually be positive. Worry when the level of conflict means that one plus one equals 1.5–or less. You have to take on hard problems so there is enough to challenge both of you, and you have to see that you are achieving more together than you would working alone.
Étienne Garbugli: I’d add another takeaway that piggybacks on something you mentioned. Setting regular checkpoints with your co-founders encourages a periodic reevaluation of the company’s direction and rate of evolution.
You also have to invest time in getting to know them, seeing how you two are working together, and having honest discussions about how they feel it is going. We touched on this earlier, but when people feel listened to, it helps at least quash some potential issues that might arise in the future.
Sean K. Murphy: I think that’s really good, especially if they’re introverted. I think you need to establish checkpoints, and tell them what you want to talk about and then give them a chance to prepare.
You can’t blindside them and view silence as consent.
Étienne Garbugli: And maybe a last takeaway.
Sean K. Murphy: If being right is more important to you than compromising to make forward progress, you probably shouldn’t start a startup because you’re not going to be able to negotiate effectively with your customers or co-founders.
Étienne Garbugli: I definitely agree with that.
If you have been listening and have feedback on the discussion, or additional advice for managing business relationships with co-founders, let us know. Sean is @skmurphy and I am @leanb2b. Please join us for our next episode.
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Three posts related to John Morgridge
- Leadership Starts With Careful Listening and Observation “The ability to listen is often overlooked in many portraits of leadership. It was not until I had attended several executive staff meetings in the early 1990’s at Cisco when John Morgridge was the CEO that I realized his willingness to listen and allow for a lively discussion was a very powerful approach.
- What Are You Doing to Obsolete Your Product?
- Two CEO Speeches I Still Remember
We are very interested in feedback or comments.
Contact us on Twitter at @egarbugli or @skmurphy
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Image Credits:
- “Candle Light” by Riyaad Minty (used with attribution under creative commons). I thought this captured the sense of providing a small but essential spiritual illumination in challenging situations.
- “Cinnamon Teal Ducks in Flight” (c) Dale Jantzen, used with permission. A small team flying in formation.