Solo founders: myths and reality

Chrisje Haenen
Aug 22, 2024
6 min read

Updated: Mar 11

Against the grain: the growing trend of solo founder startups

In the fast-paced world of tech startups, founders are the driving force behind innovation and disruption. While the traditional model involves a co-founding team, a growing number of entrepreneurs are venturing out on their own. A lot of incubators insist on finding a co-founder (sometimes at any cost) and even refuse access to their program for solo founders. Investors and investment funds often follow the same flawed “logic” and do not want to invest in single founder startups. Times are however changing.

It was often said at university that inventing something does not automatically make you a good entrepreneur or CEO. You can call yourself CTO, but you will probably need an external CEO. I never agreed with that and have since shown that a researcher can be a good entrepreneur and CEO Koen Vervaeke (founder and CEO of Magcam NV)

The rise of the solo founder

Solo founders are becoming more and more common.
Increased confidence in one's own abilities.
Easier access to resources and funding.
More accepting environment for solo ventures.

The number of solo-founded startups is on the rise. This trend can be attributed to several factors. First, there's a growing confidence among entrepreneurs to take the reins and lead their ventures alone. Second, access to resources and funding has become easier, with platforms and investors increasingly open to solo founders. Finally, the startup ecosystem is becoming more accepting of solo ventures, recognizing the unique strengths and potential they bring.

The advantages of going solo

Fast decision-making: no need for lengthy discussions or getting buy-in from co-founders.
Strong vision: the founder's vision remains clear and undiluted.
Streamlined team dynamics: avoids potential co-founder conflict and disagreements.
Equity advantage: solo founders retain a larger share of ownership.
Avoid co-founder conflict, one of the main reasons why startups fail.

There are several advantages to being a solo founder. One of the most significant benefits is the ability to make decisions quickly. Without the need to consult with co-founders, solo founders can react swiftly to market changes and capitalize on opportunities. Additionally, solo founders have complete control over their vision. They can steer the company in the direction they believe is best, without compromise. From a team dynamics perspective, going solo eliminates the risk of co-founder conflict, which can be a major hurdle for startups. Finally, solo founders get to keep a larger share of the company's equity, which can be a significant motivator. After raising capital they are likely to be able to keep control of the business for a longer period of time.

The challenges of going solo

Skill gap: can't be an expert in everything, leading to challenges outside their skillset.
Burnout: the workload can be overwhelming, leading to exhaustion and decreased productivity.
Isolation: building a company can be lonely. Solo founders may miss the brainstorming and support of a team.

While there are advantages to being a solo founder, there are also significant challenges to consider. One of the biggest hurdles is the skill gap. Founders may struggle with tasks that fall outside their area of expertise. This can slow down progress and lead to frustration. The burden of running a startup can be immense, and solo founders are particularly susceptible to burnout. The workload can be overwhelming, leading to exhaustion and a decline in productivity. Finally, the journey of a founder can be a lonely one. Solo founders may miss the brainstorming sessions, the emotional support, and the camaraderie that comes with having a co-founding team.

The era of AI and the solo founder beyond 2025

AI tools close the skill gap: tasks that used to require teams of people can now be done by AI-powered tools. So-called AI agents are spreading like wildfire.
The cloud is everywhere, and affordable. A lot of resource are open-source. A new breed of low-code and even no-code development tools drastically lowers the barriers to entry. You can build the infrastructure for your company in no time at low cost and with limited resources.
The internet allows you to market and sell worldwide. The global health crisis aka Corona has made this virtual way of operating accepted worldwide.

Thriving as a solo founder

Build a strong support network: mentors, advisors, and fellow entrepreneurs can provide guidance and encouragement.
Delegate effectively: hire freelancers, contractors, … to complement your skillset.
Make good use of AI powered virtual assistants to handle tasks outside your skillset.
Prioritize self-care: maintain a healthy work-life balance to avoid burnout.

Despite the challenges, there are many ways for solo founders to thrive. Building a strong support network is crucial. Mentors, advisors, and fellow entrepreneurs can offer valuable guidance, share experiences, and provide encouragement during tough times. Delegation is another key strategy. Solo founders can't do it all, so it is crucial to find outside help.

Famous examples of tech companies with a solo founder

Amazon - Founded by Jeff Bezos in 1994.
Dell Technologies - Founded by Michael Dell in 1984.
Dropbox - Founded by Drew Houston in 2007.
GitHub - Founded by Tom Preston-Werner in 2008.
Zoom - Founded by Eric Yuan in 2011.
Baidu - Founded by Robin Li in 2000.
Tumblr - Founded by David Karp in 2007.
Bytedance / TikTok - Founded by Zhang Yiming in 2012.
Odoo – Founded by Fabien Pinckaers in 2005.

Data supporting the cause of the single founder

On out of five billion dollar startups was founded by a single founder. That’s right, 20%! Also, fewer than 15% went through an incubator program 😉.[1]

Companies started by solo founders survive longer than those started by teams. Further, organizations started by solo founders generate more revenue than organizations started by founder pairs, and do not perform significantly different than larger teams.[2]

Bringing on an additional founder

Nothing has to stop you from bringing on an additional founder of course 😊.

However, you have to be very cautious because bringing an additional founder on board a single-founder startup is a significant decision with various strategic, operational, and interpersonal considerations.

Here are the key aspects to consider. Health warning: it is a long list.

Strategic fit

Skills and expertise: ensure the potential co-founder brings complementary skills and expertise that enhance the existing capabilities of the startup.
Vision alignment: the new founder should share a similar vision and long-term goals for the company.
Industry knowledge: they should possess deep knowledge or connections within the industry to add value.

Operational fit

Role definition: Clearly define roles and responsibilities to avoid overlap and confusion.
Decision-making process: establish how decisions will be made and ensure there is a clear process for resolving disagreements.
Commitment level: verify their willingness to commit the necessary time, energy and resources.

Legal and financial considerations

Equity distribution: decide on a fair equity split that reflects the contributions and future expectations of each founder.
Founders' agreement: draft a comprehensive founders' agreement outlining roles, equity splits, vesting schedules, decision-making processes, and exit strategies.
Intellectual Property: ensure all intellectual property is clearly owned by the company and contributions are properly documented.

Cultural fit

Work style compatibility: assess if your work styles and values align to maintain a productive and harmonious working relationship.
Conflict resolution: consider how conflicts will be resolved and ensure there is mutual respect and trust.

Financial considerations

Investment and salary: determine if the new founder will invest capital and how their salary - if any - will be managed within the startup's budget.
Financial stability: ensure that bringing on a new founder won't strain the company's finances unduly.

Network and resources

Network access: evaluate if the potential co-founder can bring valuable networks and connections.
Resource contribution: consider any additional resources or opportunities the new founder might bring.

Long-term impact

Growth potential: assess how the new founder will impact the startup’s growth trajectory.
Scalability: ensure the addition of a new founder will help in scaling the business rather than complicating processes.

Personal considerations

Personal compatibility: ensure there is personal chemistry, as the relationship between founders can significantly impact the company’s culture and success.
Mutual respect: both founders should respect each other’s opinions, expertise and contributions.

Due diligence

Background check: perform thorough background checks to verify the potential co-founder’s credentials, past experiences and reputation.
References: speak with previous colleagues or partners to understand their work ethic and compatibility.

Alignment on key issues

Company values: ensure alignment on company values, mission, and ethical standards.
Risk tolerance: discuss and align on risk tolerance and management strategies.

By carefully considering these factors, you can make a well-informed decision about bringing an additional founder on board, increasing the likelihood of a successful and collaborative partnership. It is crucial to invest time and effort in going through the (long) list.

[1] Source: Tamaseb, Ali. Super founders: what data reveals about billion-dollar startups. PublicAffairs, May 2021.

[2] Source: Greenberg, Jason and Mollick, Ethan R., Sole Survivors: Solo Ventures Versus Founding Teams (January 23, 2018). Available at https://ssrn.com/abstract=3107898 or http://dx.doi.org/10.2139/ssrn.3107898

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