"Build a strong team."
This advice is so solid in fact, many funds will only consider funding teams of two or more. The solopreneur gets over-looked from the word go.
Makes all the sense in the whole wide world. Right?
But what if you don't have the team of rockstars? Can you still make it? Could these seasoned funders possibly be wrong?
A surprising new study based on data from Crunchbase suggests you not only can make it on your own, but you can build a wild success story of a company. The fate of the solopreneur is not doomed at all.
According to author Haje Jan Kamps, the solopreneur has been the single most successful category when compared to companies birthed with co-founders all the way up to five or more. By analyzing data culled from the extensive Crunchbase database, which stores funding and exit markers across multiple geographies and segments, Kamps arrived at some surprising conclusions.
First, looking at companies that were able to land at least $10 million in funding, Kamps found a robust 46 percent possessed just a single founder. While the majority of these seven thousand companies had two or more, the single founder represented the largest category. By comparison, 32 percent of these companies had two co-founders and only 17 percent had three or more.
Now, while simply raising $10 million is by no means a definitive marker of success, it does show the achievement of an early milestone. These companies, like all others are tasked with navigating to the next waypoint.
That's precisely what makes the next data set so compelling.
Kamps then looked at another seven thousand or so companies that achieved an exit event of some kind. Again, this set was examined from the Crunchbase API, which generally tracks funded companies of some heft. The data set was different in this second set, meaning that some of these exit events did not necessarily include a funding round of $10 million or more.
Still the data produced some stark numbers.
In this group, a stunning 53 percent of companies had just a single founder. Another 30 percent of the set were made up of a pair of co-founders. Which leaves just 17 percent of the companies with a successful exit comprised of three or more founders. Apparently, there is not necessarily strength in numbers after all.
Of course, this study does not pass the tests of strict scientific rigor. Nor does it debunk the idea that strong teams make for strong, successful companies.
It does however, suggest that solopreneurs are not doomed. Far from it, the single operator may have just as good a chance, or better, than any other setup.
I've seen the good and bad in both arrangements.
I'm currently running a technology startup with a very complimentary team of three founders. We spread the burden across our very different brains and personalities. We haven't declared victory on our thing yet, not even close, but if our technology has a chance to make it, I like this group we've assembled.
At the same time, I'm embarking on a turn-around mission for a company that started off with four founders who, on paper, looked like a great team. But, egos and turf wars got the best of them. They couldn't come together on major or even minor decisions. They were doomed almost from the start.
I've also had two solo efforts in my past that worked out great. Two solid triples. Exits to be proud of.
So, what have we learned here? Perhaps just this: The number of founders in a startup is only a small determinant of ultimate success. And, if you're a solo operator out there, don't go down the path to find a co-founder just for the sake of having a co-founder.
At the end of the day, businesses are successful based on the principles of building successful businesses, not on the number of chefs in the kitchen. Be selective. Make sure all the little things line up with a potential co-founder prior to a non-revocable invite to dinner.
Above all, trust yourself.
You, by yourself, are capable of more than you think you are.