The Power of Co-Creation
At a time when the partnership-driven Indian Government is about to complete a decade in business; are there lessons that entrepreneurs can learn from the government about the power of co-creation and co-founding for building a successful enterprise?
Inspired by the Sonia Gandhi-Manmohan Singh combination, SMEntrepreneur explored the concept of co-founding in Indian enterprises and found many examples that represented great partnership and great success. Here we present three prominent ventures where success is derived from the co-founding/co-creation concept, and we also try to glean important lessons for all.
The Power of the Left Brain/Right Brain Combine
The concept of a co-founder can be seen as harnessing the power of the left and right brain simultaneously. The concept states that left brain people excel at linear thinking and meticulous execution and right brain people at the creative and vision based approach. The success of an enterprise happens only when the most creative planning meets the most meticulous execution.
The arrangement by which Prime Minister Dr Manmohan Singh and Congress President Sonia Gandhi share power and function as a partnership can be seen as one of the most celebrated examples of strategy meeting execution and meticulous detailing. While Dr Singh looks after the day-to-day execution of government policy, Gandhi develops the strategy, oversees results and the bigger picture. Both have a common goal. But both play their different roles to achieve it.
The Anatomy of a Co-founder
The importance of a co-founder can be gauged from the fact that one of the most important things investors look at is the team. A good idea might not be able to scale up because of bad team, but a simple idea can be executed well if great minds are at work.
Some people out-and-out prefer working with a co-founder. According to Siddharth Nambiar, Co-Founder & MD, OfficeYes.com, “You should have complementary skill sets. The presence of a co-founder helps at the emotional and practical level because you know somebody else is there in your place to settle the issues.”
“The entrepreneurs get the days of high highs and low lows. So it is always better to have a co-founder,” he adds.
The co-founder’s work is hands-on. The co-founders are usually the guys who do everything. The work of running around and putting things together might need a helping hand.
Having a co-founder also means somebody else shares your passion. Technology businesses need someone to run some parts of it. These days the concept of a co-founder is almost synonymous with technology start-ups. When Hitesh Oberoi decided to quit Unilever and wanted to join a start-up, Sanjeev Bikhchandani asked him to come over as a co-founder and look after the marketing operations. Today the two of them are leading the enterprise well.
However, this also puts across a strong possibility of conflicts but that can also be helpful in bringing opposite sides of the same issue. “As long as you respect each other’s background, capabilities and other skill sets, it is ok to have conflicts,” agrees Nambiar.
How to Find a Co-founder?
Finding a co-founder is similar to finding a life partner. You never know when the right one clicks. But what is the best way to find a co-founder? Nowadays we are seeing a lot of events taking place where you can pitch for a co-founder. But seeking a co-founder calls for sharing the same mindset and dream which you want to fulfil together. Be a part of Internet discussions and forums and let others know that you are working on an idea. “I actively seek out people who are like-minded. We often discuss with friends and acquaintances if they want to do something in the future who we can seek out later. If they have complementary skill sets and business skill sets they can come on-board,” suggests Nambiar.
“If you are on the lookout for the ‘perfect’ person to start something with, chances are you will end up disappointed. The best you can do is to work with someone you have known for a while or with whom you have successfully collaborated before. Easy familiarity helps conversations move quickly and allows trustworthy cooperation,” opines Sidharth Rao, CEO & Co-Founder, Webchutney.
It is important to see whether there would be compatibility when two minds get together. “I think there is a courtship process that you have to acknowledge. This courtship happens over several months or years. It happens that you meet a professional who wants to turn an entrepreneur at some point. You look for people you think you will collaborate and work well with,” says Nambiar.
On how should one go about finding the right one, Sunder Nookala, Co-Founder & CEO, Kwench, says, “Basically, it matters on two-three key principles. One is both of you must share common values. If one is spendthrift and the other is highly conscious, then culture clash will be there. Second is the complementarity of skills. If somebody is a risk-taker, the other should be more analytical. What is missing in you is what you should look for in a co-founder. Imagine if both founders are good in technology, they will end up discussing the same thing rather than discussing about other growth aspects.”
Before you approach anyone with a proposal and are expecting them to buy into your idea, you must do your homework and know exactly the role you are trying to get them to fill and then you must prove that you can sell your idea. Of course, it always helps if you are approaching someone who shares the same product or service interest,” adds Rao.
How to Keep it Right?
However, since all the co-founders are involved in the decision making, there has to be a structured approach to it. People need to know that they will need to lead in certain areas and others will lead in different areas else clashes are bound to happen.
While seeking a co-founder, one should also talk of creating some sort of an exit strategy so that if things do not work out they can go out on separate ways. In the partnership agreement, if the partnership does not work out, one partner should be free to leave.
“The basic common mindset should be that we are there for a long haul. If one is looking at a quick exit and is trying to look to sell the company it is not going to lead anywhere,” says Nookala.
Passion, patience and perseverance, if these three common things are there you can overcome all hurdles. But if things do not go as planned for long it can cause a lot of problems. Some people who cannot take it and do not have that patience to hang in there will fizzle out. It is important to keep the common objective intact and go for it.
“You have to derisk it basically. It is about incentive success. When we went about equity allocation, we decided whoever quits first would take the highest risk and would get the highest equity. Whoever quits last would not be seen as quitting as he has a benefit of hindsight and has to be given less equity. That incentive of disincentive has to be built into that agreement of co-founders,” adds Nookala.
“Keep all terms – investment and equity, control and governance and departures – clear from the beginning . Communicate even when you do not agree and continue to keep your focus on the bigger picture. It really depends on what the co-founder brings to the table in terms of skill sets,” shares Rao.
Equity allocation is also a major concern while bringing on board a co-founder. “It depends on what value one is brining to the table and that has to be crudely evaluated. This is based on present value, as future value we cannot apply. Whether today is critical to the start-up or not. If yes, then you have to part with a high stake. If the period is not so critical then you can negotiate,” points out Nookala.
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