Ask HN: How do you make decisions between cofounders? | Hacker News Reader

Ask HN: How do you make decisions between cofounders?

5 pointszaidf9 comments

Cofounder A thinks you should do something using method 1. Cofounder B thinks you should use method 2. How would you do decide?

I know the ideal winner would be the cofounder who just does it. And in most cases, that is how decisions are made. But this is for the exceptions(ie. "do we build this product?") where you cannot simply execute and let the results talk.

How do you guys handle it?

Appreciate your tips.

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Switch positions and argue the others case as good as you can.

It will help you immensely in evaluating the relative merits of both options.

That's an awesome idea! I do this very often for my own ideas.

You choose the option that gives you the biggest return on invest per time of the constraint. In this case your development time probably is the constraint.

ie. Sales price Raw Materials Margin Product A 1000 us 200 usd 800 Product B 2000 us 200 usd 1800

so seems like product B is a no brainer right?

But if we consider the time it takes to implement: Margin Time to Develop Margin / hrs Product A 800 100 hrs 8 usd / hr Product B 1800 300 hrs 6 usd / hr

So product A is in fact a better use of your time.

This analysis method is called Throughput Accounting. From a management philosophy called: Theory of Constraints

The one that gives you the biggest return on invest per time of the constraint.

ie.

            Sales price    Raw Materials  Margin
  Product A   1000 us        200 usd         800
  Product B   2000 us        200 usd        1800

so seems like product B is a no brainer right?

But if we consider the time it takes to implement:

            Margin   Time to Develop  Margin / hrs
  Product A    800         100 hrs        8 usd / hr
  Product B   1800         300 hrs        6 usd / hr

So product A is in fact a better use of your time.

This analysis method is called Throughput Accounting. From a management philosophy called: Theory of Constraints

Note: This is the same as the my previous comment just used the correct spaces.

You may not always be able to execute and let the results talk, but you can always do the next best thing. If it is an external issue (e.g. adding a feature, building a product, designing an ad, etc.), do a focus group and see which yields more favorable results. Don't let the results make the decision for you, but learn what you can and maybe it will lift the stalemate.

If it is an internal issue (e.g. deciding a reimbursement schedule, valuating the company, writing the business plan, picking a bank, etc.), find a mentor who has done it before and seriously consider all of the insight they can provide.

Objectivity. Each of you has a reason for why you are rooting for a certain decision's side... so list those reasons out. Just write down the the advantages/disadvantages of each decision (hrs of dev time, complexity, return of the final product, etc), and keep everything objective as possible by numbers if possible.

Then do a Side by side comparison, this takes away the subjectivity and emotional aspect of decision making, and ultimately help you make the best decision possible.

Starting a startup with 2 founders is probably the worst mistake startups make. Voting is split 50/50 and decisions become impossible.

The team should have 3 or 5 members (not 4, its even and can also lead to 50/50). Get another founder or get a coach/advisor/friend who you both trust and that can make a rational decision when you 2 are of different opinions.

-- MV

I would agree that decisions with 2 people are difficult, but I don't think they're impossible. A marriage could be considered a startup with only 2 founders, and in that case, making a decision where the equity is 50/50 is essential to making it work. And while many of these 'startups' fail, countless others succeed.

In marriage, as in business, honesty and the ability to take another's perspective go a long way. Ideally, you've chosen a partner whose abilities and insights compliment your own and decisions can be made by the one most qualified to make them.

I would think twice about starting something with anyone who was immovable in their opinions. (and you'd know if they were or not pretty quickly) It may not be the first instinct of entrepreneurs, but there is a possibility that both parties are wrong! ;)

-jc

*edited for word choice

Write down all the pros and cons, then take each topic in discussion and try to bring as many objective and logic arguments as possible.

Leave personal feelings and your ego aside, if you do that the other might do the same and you might reach an agreement.

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