How to assess solo founders?

Everyone in the start-up scene has an opinion on solo founders, vs two founders, vs three founders, and their relative chances of success.

Whilst I’m not advocating for any particular ‘template founding team’, I believe that the dismissal of solo founders as a viable option is premature.

Instead, I want to propose a framework for how solo founders can be assessed, rather than written off.

If you’re an investor and get turned off as soon as you hear ‘solo founder’, or if you’re a solo founder, and are wondering about the best way to set yourself up for success, this is for you…

What disadvantages do solo founders?face?

Before we jump into the framework for assessing solo founders, it’s important to talk about why, in the first place, there is a preconception that solo founders are unsuccessful.

1. There is too much to do for just one?founder

Building a start-up is HARD. The amount of time needed to go from 0–1 and build something people want is significant, and one founder taking that on is nearly impossible.

To have the time (let alone ability) to speak to users, test solutions, build products, test marketing channels, build partnerships, hire, reach out to investors… the list goes on. Even someone working 70 hours per week would struggle.

2. Lack of commitment

It may be too easy for a solo founder to decide not to invest the time required to build the business quickly enough to succeed. They have no one holding them accountable, they are the final decision maker, and they aren’t being motivated by the work other founders in the team are doing.

3. Loneliness

Possibly the hardest, a solo founder must go through the inevitable ‘downs’ all on their own. When they get rejected over and over again, having people around them lifting them up can be the difference between throwing in the towel and finding it in themselves to keep going.

4. Solo decision?making

When only one person is making the decision, there are no checks and balances on whether the founder is deciding correctly. No matter how smart people think they are, none of us are smart enough to always see the flaws in our own logic.

What are the benefits of being a solo?founder?

With all of the additional issues facing a solo founder considered, it seems they have a whole extra mountain to climb vs larger founding teams

Whilst there are clearly hurdles, we shouldn’t forget that being a solo founder can be a great thing — not just for them, but for their team.

Most of the most successful companies in the world were started by solo founders, these are just some of the reasons why:

1. Ownership

Solo founders own 100% of their business to start with. This means they can be more generous with equity to early team members and investors. Often this means more people are more incentivised in the early days, rather than less. This can have a significant positive impact on the wider team’s commitment.

2. Speed

Simply put, decisions can be made quicker. There is no need to run something by someone else. And whilst this can be a problem if the wrong decision is made, speed often wins anyway. Poor decisions can be corrected, time can’t be recovered.

3. No co-founder arguments

Issues within the founding team are the #1 reason for start-up failure. Too many cooks in the kitchen is a real thing. Founders are by nature, very opinionated. What happens when co-founders disagree? Arguments. Fall out. In many cases, companies shut down.

4. Clear?vision

When there are multiple founders, there are multiple visions. Different founders have different relations with their team members, and the teams can end up divided or confused about where the business is heading.

How can you assess solo founders?

The following questions can assess a solo founder’s commitment, capability, support structure, and decision-making abilities to overcome the challenges associated with being a solo founder:

1. Have you invested your own money into this business? How much? What % of your net?worth?

This is the single easiest way to see how committed the founder is to their business. If they haven’t put their ‘money where their mouth is’ you should run.

How long they can keep going on this without needing an income?

2. Have you raised money from friends and family? How much? From?who?

Peer pressure from friends and family, even if it’s implicit, is SIGNIFICANT. These are people who will be around long after the business, and the fear of letting them down will keep a solo founder grinding HARD.

This is the key reason I don’t consider myself a solo founder. All my friends and family, non-professional investors, that have trusted me with their hard-earned money are equally founders in Pally. Without them, we wouldn’t have gotten off the ground.

3. Who have you hired so far? Have you got all the expertise needed to?succeed?

The required time commitment is no joke. However, the other team members do not need to be ‘co-founders’. If the founder has managed to hire experts, the split of responsibilities is clear, and everyone is incentivised to deliver, then the solo founder may have the team they need to succeed.

This is also a great indicator of their ability to sell their vision and hire people better than them; perhaps the two most important skills for a founder.

4. What’s your edge? What are your weaknesses?

Whilst it’s important for the founder to know why they can succeed even on their own (their edge), it’s perhaps more important for them to know their weaknesses.

Self-awareness is easily in the top three most important traits for a founder, and if they aren’t aware of their weaknesses they will not make the best decisions or bring the right people around them. They should know when to turn to others for help.

5. Who do you turn to when you need to make tough decisions? What’s your relationship with them, and their background?

Given the lack of checks and balances on their decision-making, it’s really important a founder has a clear support structure.

Even if ‘unofficial’, a group of trusted advisors/mentors who can support them through uncertainties, strategic decisions, and challenge them when necessary is required.

6. If you fail, what happens?next?

What’s plan b? Given the high likelihood of failure, what next? By understanding the founders’ backup plan, you can make an assessment of how ‘secure’ they are in going on this journey.

I believe founders absolutely should have a backup plan, so they’re not afraid to take the risks required to be successful.

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I hope this article helps you rethink the potential of solo founders, and gives you some helpful questions to consider rather than writing someone (or yourself) off too early.

If you have ideas for more important questions to ask a solo founder, please comment below!

Happy building!