How to Resolve Co-Founder Conflicts

As a startup founder, you are probably keenly aware of the fact that co-founder relationships can be challenging. In fact, research indicates that 65% of startups fail due to interpersonal tensions among the founding team.

We seek partners who bring out the best in us, whether we're building a business or creating a life together.

In this article, I'll share techniques for uncovering the root causes of recurring disagreements and provide strategies for managing conflict.

Co-Founder Conflicts: the covert and the overt

Every impasse between co-founders consists of both overt and covert layers. When co-founders find themselves stuck or in crisis, I often ask them to describe their last fight. However, I'm not interested in the specific content of their arguments; rather, I'm listening to understand how they engage in conflict and what triggers their reactions. The subjects they fight over are often irrelevant. What truly matters is the covert aspect—the hidden issue.

What is the underlying cause of your frustration?

What does it symbolize for you?

Have you encountered similar situations before? By asking questions like these, we can delve into deeper and more substantial topics instead of getting trapped in trivial, surface-level arguments.

Remember, conflict always involves more than just the two individuals in the room. We bring with us a collection of past work experiences and personal histories. For example, if the dispute revolves around unequal effort, it may be rooted in past experiences with demanding parents or a successful sibling casting a long shadow. Similarly, if one co-founder is labeled a "control freak" who insists on involvement in every decision, it might stem from past betrayals, making it difficult for her to trust her partner fully. In such cases, she may be projecting the negative experiences of previous relationships onto the present one.

Conflicts and issues are bound to arise in any relationship; it's inevitable and, in fact, necessary. The distinction is that in healthy relationships, we acknowledge the underlying issues and work towards resolving them. This creates an upwards spiral toward higher synthesis and integration.

Deeper issues

Here are some indicators that the fights with your co-founder may stem from deeper issues:

• Repeatedly having the same arguments: when co-founders repeatedly engage in predictable, rigid conversations with well-worn paths and tired arguments, it's a sign that things need to change.
• Perceiving your co-founder's reaction as excessive: if a co-founder reacts intensely to a seemingly minor disagreement, it's a clue that there's more to the conflict than meets the eye.
• Avoiding difficult conversations: Consistently evading specific issues or problems within the company is a significant red flag. Relationships can deteriorate to the point where co-founders barely communicate.

Are you merely patching over small cracks without addressing the root causes and building a stronger foundation?

If so, it's time to dig deeper.

What lies beneath a framework for unraveling the hidden issues?

Conflicts can be categorized into three main areas:

1. power and control,
2. care and closeness, and
3. respect and recognition.

Let's delve into each of these categories and identify the common signs that may apply to your co-founder relationship.

Power and control

Who holds more sway? Who makes the final decisions? Who puts in more hours? Who excludes the other? These questions revolve around the theme of power and control, which frequently leads to conflicts between co-founders. Here are some scenarios that highlight deeper power struggles:

Problem examples

• One co-founder complains about the other hoarding information or making unilateral decisions.
• A partner exhibits ambivalence about the company's success, threatening to leave or engaging in secret side projects that indicate a lack of commitment.

Solution

Instead of understanding each other's perspectives, we get locked in a struggle, unwilling to give the other person an advantage. To defuse conflicts rooted in power and control, it's crucial to shift the language we use. Rather than focusing on the other person's faults, express your own experience and address the core dynamics. In this case, pointing out the power imbalance directly allows both parties to reflect on their perspectives and work towards a resolution.

Care and closeness

Do you feel supported? Are you in this together? Conflicts based on care and closeness often stem from broken trust, leading to statements like "I thought I could count on you." When trust is shattered, it undermines the relationship and our sense of value within it. Look out for these signs of care and closeness issues:

Problem examples

• One founder feels rejected or excluded within a company with multiple co-founders. Meetings are conducted by one founder alone, disregarding the desire of their business partner to be present.
• A founder perceives their input as undervalued in the decision-making process, or fears being replaced by someone else.

Solution

To address care and closeness conflicts, it's important to practice reflective listening. Begin by acknowledging, validating, and empathizing with the other person's perspective. Avoid the urge to rebut and take responsibility for your actions instead. By saying, "I know I do this," you remove the burden from the other person, fostering open communication. Co-founders engage in fights related to care and closeness because they want to feel valued. A simple acknowledgment like "I can see where you're coming from" can provide validation.

Respect and recognition

Conflicts stemming from respect and recognition often centre around questions of integrity and self-worth. Do you receive due credit for your contributions? Do your efforts matter? Here are some indicators that respect and recognition issues may be present in your co-founder relationship:

Problem examples

• One co-founder consistently takes credit for the team's efforts. That co-founder receives all the attention in press coverage, while others are barely mentioned.
• Often, one person assumes the role of CEO, becoming the face of the company. While this is sometimes accepted, resentment can build if there is a lack of recognition for others' contributions.

Solution

Dispel the myth of the lone genius and emphasize collective efforts. Instead of saying, "I've done," consider alternative statements like "We've done," "With the help of my colleagues," or "My work builds upon others' contributions." When your co-founder expresses a reaction rooted in respect and recognition, pause and acknowledge the validity of their feelings. A simple "I see why you took it this way" can go a long way.

Improving overt conflict management: practical tips for cleaning up your fight

If there are already disagreements, it's important to handle conflicts effectively to prevent them from escalating into damaging situations. By implementing these six practical tips, you can navigate conflicts in a healthier manner, defusing tensions and fostering a more harmonious working relationship.

Recognize the positive:

Instead of focusing solely on faults and flaws, adopt a positive mindset. Reflect on what you appreciate about them and what you couldn't achieve without their support. Elevating their strengths instead of dwelling on their shortcomings can help shift the dynamics.

Address specific issues:

When dealing with conflicts, avoid overwhelming discussions by piling on every complaint. Stick to addressing one problem at a time rather than bringing up past grievances. By focusing on the specific issue at hand, you can maintain clarity and work towards resolving it effectively.

Avoid personal attacks:

Steer clear of attributing negative behavior solely to your co-founder's character. Instead, consider temporary and circumstantial explanations for their actions, just as you would for your own. This approach helps minimize conflicts arising from assumptions and personal judgments.

Understand conflict styles:

Recognize that people handle conflict differently. Familiarize yourself with your and your co-founder's conflict management styles and have an open conversation about them. Here are some typical conflict management styles:

1. Collaboration: collaborative individuals aim to understand the concerns of all parties and work towards a resolution that satisfies everyone's interests.
2. Compromise: This style involves seeking a middle ground or reaching a mutually acceptable solution through concessions from each party.
3. Accommodation: This style emphasizes preserving relationships and maintaining harmony by prioritizing the needs and desires of others over personal interests.
4. Avoidance: This style entails evading or sidestepping conflicts altogether. Avoiders may choose to ignore or delay addressing the conflict, hoping that it will resolve itself or fade away.
5. Competition: This style involves pursuing personal goals or interests at the expense of others. Competitors prioritize their own needs, assert their positions strongly, and may use power or influence to dominate the conflict.
6. Mediation: Mediation involves involving a neutral third party to facilitate communication and negotiation between conflicting parties. Mediators help identify common ground, clarify misunderstandings, and guide the parties toward finding a mutually satisfactory resolution.

Understanding each other's tendencies can aid in better co-regulation and conflict resolution.

Use balanced statements:

Avoid making categorical statements like "You always" or "You never" during conflicts. Instead, express your experiences and feelings without presenting them as absolute facts. By framing your concerns as personal perceptions, you encourage open dialogue and avoid creating an adversarial atmosphere.

Practice active listening:

According to research, people tend to tune out after only 11 seconds of listening during conflicts. To combat this, keep your statements concise and pause to allow your co-founder to reflect on what you've said. By encouraging active listening, you foster mutual understanding and improve communication.

Fostering good relationships

If you haven't experienced a fight with your founding mate yet, consider yourself lucky. But remember that if it hasn't happened before, it doesn't mean it won't happen in the future. Here are some practical tips to make sure fights don't happen.

Clear and non-violent communication:

Establish open and transparent communication channels from the start. Encourage regular and honest dialogue where both of you feel comfortable expressing your thoughts, concerns, and ideas. On this note,  the method of Nonviolent Communication (NVC) is a great way to avoid unnecessary conflicts. In short, NVC is a communication process, which emphasizes understanding, and compassion. NVC involves observing situations without judgment, expressing feelings, identifying underlying needs, and making clear, positive requests. It aims to foster connection and resolve conflicts peacefully. This topic will be covered in more detail in another post.

Have a dedicated meeting:

Set up a dedicated meeting for your relationship every two to four weeks where you talk about just that. Both of you should prepare for this meeting and tell each other what you value in the other and what bothers you. Be sure to avoid operational and strategic matters about the company. A recurring meeting like this is especially helpful if you don’t know your Co-Founders prior to working together.

Document agreements:

Formalize important agreements and decisions in writing, such as a founders' agreement or partnership agreement. Clearly outline expectations, responsibilities, equity distribution, and potential exit strategies. Having a written record helps prevent misunderstandings and provides a reference point in case of disputes.

Seek external support:

If navigating conflicts alone feels overwhelming, consider seeking the guidance of a coach or therapist. Just as you have advisors for business decisions, having a third party who can help you strengthen your connection and navigate challenges can be beneficial.

Conclusion:

Startup relationships are dynamic, involving moments of harmony, disharmony, and repair. By implementing these strategies, you can improve conflict management, strengthen the co-founder relationship and positively impact the company's culture. Remember, the way you handle conflicts influences your team's behavior and contributes to overall success.

If you need help managing your relationship or want to have a friendly chat about the topic, feel free to contact me.