Are you going into business with the right person? The answer was apparently no in the case of Zipcar's founders. Here's what you can learn from them.
I've heard this again and again from successful entrepreneurs, and I've lost count of how many investors tell me that they put their money behind people--as much or more than ideas. Still, so many people go about this the other way around. It's especially sad to hear the stories of founding teams that had truly amazing ideas but who fell apart on a personal level.
Take Zipcar, the rent-by-the-hour car service that was founded in 2000, went public in 2011, and was later acquired by Avis Budget Group for nearly $500 million. You won't find the names of its original founders, Robin Chase and Antje Danielson, hi5 promo codes anywhere on Zipcar's website now; its About Us page briefly tells the company's story without naming them. The reason? Chase and Danielson left the company years ago. According to a new article in The Verge, the two women haven't even spoken in a decade.
I interviewed Chase for a book I co-authored with Jon Burgstone, so I knew some of Zipcar's story, but The Verge account adds some context. The story drives home the keys to how most successful business partners work together and what wrecks the chemistry between others.
1. Have a successful history together before founding a company.
This is by far the most important item on the list--the one thing from which everything else will flow (or won't). Great business partners almost always have had a prior history of working with each other. The more closely they've worked together, the better.
If you think you've found a promising person to pair up with but you don't have that kind of history, then get it. Work on small projects together, or at the very least, spend a lot of time together before you agree to do anything. You don't want the first time you have to work through a disagreement to be at a crucial point in the early life of your company.
Chase and Danielson knew each other because their kids played together on a playground. They were friends, or at least friendly, but they had never worked together before. They went from the excitement of a conversation about a cool business idea to holding their first Zipcar meeting within a matter of days, according to The Verge. That fact seems to have led to a lot of other issues.
2. Agree on vision.
Nothing derails a new venture like having business partners working at cross-purposes. So, it's crucial that co-founders agree on the vision--both their short-term understanding of the company's value proposition, and their long-term understanding of how they think the venture fits into the world.
Chase and Danielson seem to have gotten this part right. Their vision was aligned, at least in their earliest days. I remember one thing that struck me when I interviewed Chase a few years ago is that she and Danielson were both outsiders to the automobile industry--to the point that Chase didn't even like to drive.
"Conscious consumers, both [Danielson] and Chase agreed on wanting to drastically reduce reliance on single-owner cars," The Verge reported, "and thought that a company founded on that principle could be a lucrative one given America's growing interest in environmentalism."
3. Have the hard talks about money.
It's tempting when you start a new venture to skip some of the tough conversations. You're excited about the idea, and frankly you don't know whether you're starting the equivalent of Facebook or Friendster, so it can even seem counterproductive to get hung up on money. Some founders dodge the whole thing by just saying they'll split their equity, 50-50.