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Tiny Empire,

37 Buitenkant Street, Cape Town

+27 82 709 7657

 naett@naett-atkinson.com

"People problems are the leading cause of failure in high-potential startups"

Startup Services

Founders

Co-Founder fall-out has a huge impact on the success or failure of a startup. Few founders embrace conflict as an opportunity and most people are conflict averse. Not speaking up or avoiding the friction is even more apparent in startup teams that include family and friends. Unfortunately, conflict does not disappear.  It festers, escalates and leads to a fallout. 

There are three ways in which co-founder conflict can be preempted, prevented, resolved:

 Pre-mediation, Facilitated discussion and Mediation.

 

1.  Pre-mediation

Pre-medition is designed to preempt  and prevent the most pertinent potential friction points based on interaction with more than 300 startups. All conversations are confidential and constructive and aim to help founders make informed choices with the future of the relationship and the business in mind. 

 

This gives the opportunity for an honest conversation about what matters and are important to each founder when they are not in conflict. Founders are guided to understand each other better, direct process, culture and discuss equity splits, roles and responsibilities constructively.

2. Facilitated discussion

If founders struggle to agree on certain things or want to get to make sure that they have input from all their members about certain aspects of the startup, a facilitated discussion with specific outcomes regarding process or systems will be best.

3. Mediation

Mediation is a confidential process that happens once founders are already in conflict but prefer to resolve the conflict in the interest of the business or would like to preserve the relationship. Litigation is costly and time consuming and has a negative effect on the founders and the business. Mediation doesn't have to restore the relationship it can also include negotiating a peaceful departure or exit of a founder. 

 

It is important that the mediator understands the context and is familiar with complexities pertaining to start-ups which often include a combination of  personal, workplace and commercial issues. 

The following can be  pre-mediated, facilitated or mediated:
  • Equity 

  • Relationship dynamics 

  • Roles and responsibilities

  • Board composition, involvement, engagement

  • Systems, policies, procedures, guidelines

  • Communication, mis-communication, non-communication

  • Vision, purpose and brand identity

  • Intellectual property

  • Value sets  

  • Ethical and moral issues

  • Hiring and firing practices

  • Culture and culture fit

  • Trust 

  • Approach to scale

  • Personal trajectories, outside interests

  • Legal issues

Founders can also attend a 'Prenup for a Start-up' workshop, specifically designed to preempt, facilitate and discuss the main reasons for fall-out and anticipate a variety of scenarios and how to deal with them effectively long before problems arise.