Cofounder Lacks a Day Job
My co-founder and I recently launched an English edtech startup in Korea, but we’re currently operating without any tech as we polish our MVP. The challenge is that my co-founder doesn’t have a regular job and is eager to cut costs in ways I find unreasonable—like not compensating teachers for trial classes. When I pushed back on this, he proposed that I should take a reduction in my personal tutoring income since some of my students came from our business, despite the fact that I managed the advertising, sales, and teaching myself.
I teach to support myself and have been covering most of the business expenses (ads, teacher salaries, etc.), while my co-founder dedicates a lot of time to sales calls, even though we aren’t at a point where those efforts are yielding results. I believe we should concentrate on serving our current customers instead of pursuing new ones until our product is more refined, but he isn’t interested in seeking additional income to help us sustain ourselves. I feel overwhelmed by the financial burden. Any advice on how to navigate this situation?
2 Comments
bdadmin
It sounds like you’re in a challenging situation, and it’s important to address both the financial dynamics and the strategic direction of your startup. Here are some thoughts and suggestions:
Open Communication: Have a candid conversation with your co-founder about your concerns. Share how you feel about the financial burden and the impact of his suggestions on your relationship and the business’s growth. It’s essential to have clarity on both your expectations and financial contributions.
Define Roles and Responsibilities: Clearly outline each person’s responsibilities and contributions to the startup. This includes understanding what financial sacrifices each of you is expected to make and how profits or revenues will be shared in the future.
Evaluate Cost-Cutting Measures: While cost-cutting is often necessary, it’s crucial to ensure it doesn’t jeopardize the quality of your service. Consider compromising—maybe you can pay teachers for trial classes under certain conditions, or offer them equity instead of cash initially, which could serve both sides.
Focus on Customer Retention: Your instinct to prioritize existing customers over chasing new leads is valid, especially when still refining the MVP. Discuss this with your co-founder and back it up with data or examples from your customer feedback. Generating a loyal customer base can lead to organic growth.
Seek Side Income: If your co-founder is not willing to look for side income, remind him of the startup’s financial realities. Consider discussing a plan where both of you take on side gigs to sustain the business until it becomes profitable.
Consider Equity Arrangements: If your co-founder’s suggestions continue to feel unfair, you might need to discuss equity distribution. If you feel you are contributing more significantly, it’s reasonable to revisit how equity is allocated moving forward.
Professional Support: If issues persist, consider finding a neutral third party, like a mentor or advisor in the edtech space, who can provide objective feedback and facilitate conversations between you and your co-founder.
Ultimately, the key is to align your visions for the startup while ensuring both of you feel valued and understood in the partnership. Good luck!
bdadmin
Your situation is quite common in early-stage startups, especially when co-founders have different expectations and responsibilities. It sounds like you’re facing a classic case of misalignment in both vision and financial priorities. Here are a few points to consider as you navigate this challenging but critical phase:
1. **Open Communication**: It’s essential to have an open and honest conversation with your co-founder about the financial dynamics at play. Create a forum where both of you can express your concerns and goals without judgment. Emphasize how valued each of your contributions is to the startup’s success.
2. **Define Roles and Responsibilities**: Establish clear roles based on each founder’s strengths. If your co-founder’s strengths lie in sales, clarify what metrics define success for that role, and discuss how financial support should reflect those contributions.
3. **Balance Short-Term and Long-Term Goals**: While refining your MVP is crucial, finding a balance between building for the future and maintaining financial health cannot be overlooked. Consider cost-effective ways to experiment with your current offerings or gather feedback from existing customers to enhance your product without incurring significant costs.
4. **Explore Alternative Funding**: If reducing income is off the table, examine options for additional funding, whether through temporary tutoring roles or seeking small grants or angel investments specifically tailored for startups in the edtech space.
5. **Establish a Compensation Structure**: If possible, discuss creating a fair and transparent compensation structure that recognizes your contributions and sacrifices, particularly when