Firstly, a Happy Dhanteras! Today it makes sense to talk about the “money” side of entrepreneurship. Many people have the needed skills, experience & passion to be great founders. Yet they’re unfit to be one. Why?
It’s to do with “founder financial viability”. While there’s an appreciation by most founders for a need to bootstrap & work without market salary for some time, usually they grossly underestimate this duration to be a few months till first round of funding arrives.
However, most startups toil for 3-4 years before they find their mojo. During this time, life & finances are like a sine wave & one needs to be able to weather the troughs. Cases like 2-3 years to soonicorn status are 1/1000th exceptions. While you hope for that outcome, plan for the worst.
When forming a team, founders look at co-founders from the skills lens. But the co-founders’ extended financial viability is just glossed over, often as it’s an intrusive & personal detail. If any co-founder can come under financial duress within 3-4 years w/o salary, you’re not giving yourself enough time to figure it out.
Wealth creation in long-term often needs wealth erosion in the short-term. So ensure that everyone on the team can sustain that before jumping in.