The unspoken pain of co-founder relationships

One freezing, rainy day in Paris

I remembering walking around Paris in the freezing rain. It was March of 2010 and Paris was just turning the corner out of winter. I was shivering as I chatted into my earpods about the California dream.

Todd and I had been talking for months about starting something again. Our first attempt at working together had been wildly fun but short-lived. We had started a car-comparison website out of my apartment in Ann Arbor, MI, when we were both 23 years old.

The plan had been to move to Seattle and build the business there, but Todd fell in love with a beautiful girl named Katie and decided a move out of Michigan wasn’t in the cards for him. It was all very Garden State. To his credit, he did marry that girl and they now have two adorable kids. So that worked out in glowing fashion.

I’d moved to LA to join a startup. Then on to France for a few years to get the international thing out of my system and have a few crazy adventures while still in my twenties. But I missed California. And I got the itch to start something again. So, six years after Todd and I had first made the decision to quit our jobs and start something, I found myself walking around Paris soaking wet trying to convince him to make the big move out of Michigan, to bring along his pretty wife, and to join me in starting a new life and a new company on the west coast. He and Katie decided to make the move.

We didn’t have much of a vision for what we might be building.

It didn’t much matter to us.

The dream wasn’t to build the next Facebook. The vision was to live by the ocean and work with our friends.

We convinced one of my other best friends, Steve, to join us. Steve was one of the few software engineers I knew, also brilliant, and he agreed to join our haphazard journey into the what’s next.

Kevin would join as our fourth cofounder after we sold our first barely-off-the-ground venture and evolved our second project into what would eventually become Twenty20. Kevin would become known as ‘the Zenmaster’ for his unflappable nature and never-ceasing smile. But in the earliest beginning, it was just the three of us: Todd, Steve, and me. And that’s where I am going to focus this post.

Seven years later, I would find myself the only remaining member of those original three still at Twenty20. As we went through the sale of the business last year, this realization was poignant and painful to me.

We had far exceeded our expectations on nearly all fronts. We had built a product used by hundreds of thousands of people around the world. We had worked with some of the best investors in the world. Eventually, we built a very unique culture and a beacon on the westside of Los Angeles for the idea that the workplace can be a source of humanity and personal growth.

But on our original mission to live by the beach and work with our best friends, we failed.

The shifts of that first year

The cracks probably began the first year we started working together.

I need to caveat here that the only part of the journey I really know here is my own. Todd and Steve had their own experiences, their own successes and failures, and likely very different lenses through which they see our time working together. I plan to share this post with each of them in advance of publishing in order to help scrub any egregious errors, but it’s, of course, a fault (and perhaps miracle) of the human experience that we only have our own mind through which to interpret and record life. But from where I sat at least, the shift began that first year.

None of us had ever seen it done right. We had never worked in a successful startup nor seen a company thoughtfully run from the ground up.

I had had early leadership roles in a couple of floundering companies. They were run by well-intentioned founders but never found any meaningful traction. These experiences did not leave me with a clear vision for how an early-stage CEO might help lay a firm foundation for a young company.

Nonetheless, there we were.

The three of us found our way to Los Angeles, the agreed-upon headquarters for our new venture, and we rented our very first office. We were quite proud of it because it had an ocean view. Sort of. It was comprised of two tiny rooms on the back end of a self-storage building in Redondo Beach. Our office looked directly down onto the massive Redondo power plant. 95% of our view from left to right was the grey power plant. But the other 5%, those glorious slivers of blue to the far-left and the far-right, were our own little pieces of beautiful Pacific Ocean. And we were damn proud of that.

We didn’t have formal roles in those early days. But we agreed broadly that Steve would handle engineering, Todd product and marketing, and that I would be the CEO and handle ‘all the business stuff.’ None of us really knew what all the business stuff meant, but I was the only one who wanted the CEO job.

I remember in that first year feeling a responsibility in being the CEO that made me feel different, apart from my co-founders, and often entirely alone.

Looking back, this alone-ness was a cave of my own making.

Somewhere, in my first 30 years of life, I had arrived at a picture of leadership that implied leaders figure shit out alone. The leader solves the problems in his own head and carries anxieties on his own shoulders. I think I had witnessed that image in the classic male figured carved out in American media, and I had seen it lived out by my own father. Wherever it came from, it is how I felt I needed to lead even in those early days. My reticence to bring my concerns, curiosities, and emotions openly to my co-founders in those early days contributed significantly to the cracks in our foundation as a team that would ultimately be our undoing.

The shift in raising

If I felt apart from my cofounders in the early days, that separation was exacerbated greatly when we decided to raise venture capital. Our team snowballed from the initial 4 to 12 in that first year with outside money. My attention shifted suddenly, and I think permanently, from inside-focused to outside-focused.

In the first year, when it was just the three of us, we really felt like a team. Even if I found myself often in my own head or isolating in my anxieties, we sat in the same small room together and talked about so much of the work together. Although there’s much I wish I could go back and do differently, there was some real magic in those early days.

As I’m writing this post, I’m sitting in a hotel room in Detroit. Up at 4 AM with some weird kind of jet lag, and I’m finding myself tearing up at the memory of that time. These tears are surprising me, because at the time those months felt so anxiety-ridden. I think I’ve blocked out the good times.

In the ensuing six years, the company would far-exceed the expectations we had sitting in our tiny office next to the power plant. That journey would do irreparable harm to the close friendships the three of us once shared.

I think the loss of those relationships has caused me to block out so much of the early days building the business.

When I moved back from Paris, all I wanted was to have a little business by the beach where I could go to work with my best friends every day.

Within two years, Steve would be out of the company entirely and Todd and I would be barely speaking.

The Steve story

Steve and I met as the 2nd and 3rd employees of a startup in Los Angeles in 2005. We were both new to town and did not have many friends. We sat side by side in an office smaller than my college dorm room. And we became great friends.

Steve is a brilliant, MIT-trained engineer who we often joked, for good reason, could build anything in two weeks.

When Todd and I started talking about chasing the dream, moving to LA, and starting a company together, we decided we needed a technical cofounder. And Steve was the obvious choice.

As we began to explore working together, we agreed to meet up in Ann Arbor, Michigan, to give Todd and Steve a chance to get to know each other and the three of us some time to chew on ideas. We took a road trip up to Harbor Springs in northern Michigan, rented a tiny cabin, and proceeded to eat junk food and play a hundred games of Catan.

By the end of the weekend, it was settled. The three of us were going to start a company together.

In the ensuing two years, we had a crazy ride of struggle and false starts. We started one shitbox idea and sold that after eight months making just enough cash to re-invest and start something new.

Two years in, we finally hit some impressive traction in our first launch of Instacanvas (a fun and straightforward product that allowed any Instagram user to get their own online gallery to sell their work as canvas wall art).

Instacanvas popped, grew virally to $1M+ in revenue in a few months without marketing, and we suddenly found ourselves able to raise our first real venture capital quickly.

With the money came a mandate to grow the team and explore predictable ways to scale revenue outside of our early viral engine. We began hiring engineers.

For me, as a non-technical CEO running my first venture-backed startup, the world of engineering was quite a black box. Over the years, with the patient partnership of Michael Robinette, who would come in later to lead engineering for us, I slowly learned how to help build a culture where engineers could thrive. But, in 2012, I had no fucking idea, and I floundered.

Todd, Kevin, and I entrusted the green lighting of engineering hiring, and all engineering management, to Steve.

It started out pretty well. Except for the first engineer we hired quitting without notice, seemingly leaving the country and taking our laptop with him. You cannot make this shit up.

But after a couple of months of growing the engineering team, we started to hear complaints about Steve. We were told in no uncertain terms that Steve had to go or our best engineers would quit.

To my recollection, it was Steve’s first time managing, and I deeply regret not partnering with him more closely to help resource him in that effort. My best guess is, at least at that time, Steve was probably wonderfully suited to being an individual contributor or architect but not well suited to scale an early engineering team and a high-growth startup. Particularly not with a CEO who didn’t know how to assist.

That should have been totally fine, and I still believe if I had had more experience and foresight we probably could have found a path to keeping him on the team.

But I didn’t. And we didn’t.

Todd and I took Steve to lunch and fumbled our way through asking him to consider shifting his role and supporting our desire to bring on a more experienced engineering lead. I have a pit in my stomach even now remembering that lunch. For better or worse, we paired our ask with a request he return a portion of his equity (we made the mistake of splitting the company in thirds) to help us cover the substantial grant we would need to make to recruit a top lead.

None of this landed well with Steve, and he promptly quit.

While I believe still we did the necessary thing for the company by making a hard change, I was heartbroken over the loss of Steve’s partnership and friendship. 7 years later, I still carry grief over that loss.

Our friendship has not recovered. And I lost one of my very best friends.

I know Steve experienced his own difficult losses around his departure. And that grieves me as well.

Steve was gracious in the end as is his lovely character. We met for a beer a year or so after he left. We chatted about our friendship from the earliest days in that tiny office in Manhattan Beach to the difficult parting and the roads our lives had taken since. I hope there are more beers like that to come.

The Todd story

Todd and I had been best friends from the time we met in 2003 until we decided to move to LA together in 2011. After shutting down our first company in 2004, both of us pined for another opportunity to work together. We loved that first attempt. It was each of our first departure from working for the man; those days starting our first own thing in my Ann Arbor apartment were glorious. I would sit at my living room desk, and Todd would sit next to me parked at my dining table.

I think those days were each of our first taste carving our own destinies. The idea of doing so alongside a friend we loved resonated deeply with both of us.

In the years between shutting down that company and beginning to work again with Todd in 2011, I dearly missed that comradeship and connection. I did other interesting work throughout those years, but I felt alone in the experience.

The work never held the connection and the trust working with Todd held.

I was thus thrilled when we settled in LA together with a commitment to finally starting another business together.

Those early days in LA were fun and I have a smile on my face looking back. I remember walking around Hermosa Beach together brainstorming what we might do. We had no fucking idea. Ideas, as varied as a lux movie theater, car wash, and a variety of web-based businesses all, made the list.

Even in those early days, the work never held the playfulness and levity we had treasured from our first stab at working together 7-years prior.

I think at 24, work still felt very much like it could be play. We had little to lose. We had little savings, cheap apartments, and we were both single.

At 31, we were both married. We both completed top MBA’s and had spent years building separate careers.

Our ambitions and values had evolved independently in ways we never stopped to discuss.

It did not take long for Todd and me to begin to lose the friendship that brought us together to start the company in the first place. We dreamed for years of starting a company together and living again in the same town. But we quickly spent time together only at the office.

I think as the business accelerated it became such a heavy presence in each of our lives that we did not want to carry it into our nights and weekends more than necessary. I do remember a few stabs at spending time together over dinner where we committed to ‘no work talk;’ but it was never quite the same as friendship pre-startup.

In the year after we raised our Series-A and scaled the team to 50+ people, we hit our hardest spots. We lost trust and connection. It soon followed that we stopped believing (or remembering perhaps) that we had each other’s best interest at heart.

I found myself seeing Todd first as our VP of Product (or later Head of People) rather than as my best friend. I think he saw me first as the CEO he was frustrated with rather than *his* best friend.

Around that time, we did make some very positive changes. We attended a cofounder bootcamp together that gave us some space to begin processing some of the challenges our relationship was facing. It also gave us common context and language with which to carry those conversations back to our daily lives. We both began working with coaches who helped us process our own experiences and journeys.

We both began to better understand and take ownership of the ways we were personally culpable for the parts of our experience that make us unhappy.

I personally began to understand that I had major issues with trust that went all the way back to my childhood. I learned from my family of origin that it was not always safe to let other people into my fear. My parents were suffering from their own pain during much of my late childhood. As a result, I internalized a message that it was dangerous to take up space even among trusted loved ones. It was much safer to turn my anxieties or fears inward and rely on myself to figure them out alone.

This played out as you might expect in my role as a founder and CEO. As the stakes increased, so did my fear and anxiety.

What if I didn’t measure up?

What if we failed and I lost all these people’s money?

What if I let down all these employees and their families?

I turned that anxiety inward and it showed up as depression and isolation. I would eventually learn how to begin letting other people in, including my loved ones and my team. But in those early years, my inner-reliance took a huge toll on my relationship with Todd.

I did not let Todd into the fear I was facing. Instead, I showed up to our conversations too caught up in my own inner voices to be a present, patient partner to him. I have no doubt if I had said, “I’m suffering. I’m afraid. I need your friendship” he would have offered it immediately. I lacked that language and self-awareness for much of our early working relationship.

Over the course of the next two years, our working relationship did improve immensely. And our friendship even improved modestly. I went through a painful divorce; Todd and Katie invited me to stay in their guest room for a few weeks and took kind care of me as I scrambled to fathom how I might remake my life. But our friendship reminded strained by the company’s presence in each of our lives.

Todd would ultimately choose to leave the company during the large layoff that I (and Twenty20) have written about extensively. That layoff and company reset would mark a turning point in the trajectory of the company and in my experience as CEO. From that point forward the team would stick together, 5x revenue, and eventually sell the business. But the loss of Todd always left a particularly painful feeling in my chest when I thought back on that time.

At the time we decided to layoff our sales and account management teams, and to shift our focus to self-service revenue, Todd was our Head of People. He had taken the reigns in scaling our culture, recruiting, and people operations as we tackled our early stages of scale. And he really thrived in that role.

As we plotted the layoff that would cut our team from 55 to 12, I asked the leadership team to assess their own determination to stay for at least the next year. I knew if any key leaders left after the layoff, the team might spiral. We needed stability and cohesion among the retained team if we were going to have any chance of saving the company.

I thought one of our other leaders might leave, but it never occurred to me Todd would leave. However, the day after I asked the leadership team to evaluate their determination to stay, Todd asked me to breakfast and told me the time had come for him to leave. His heart was in scaling the team. He knew if he stayed it would mean less people work and more product work. His heart just was not in that work anymore.

I credit Todd with having the courage to evaluate what was right for him and for his family. And for sharing the decision with me openly and in an incredibly human fashion. Very in line with his beautiful nature.

A few days later, after we had gone through the layoff and were working on resetting the team, Todd had second thoughts. We had already told the remaining team of Todd’s decision to leave. But seeing the team resetting and my efforts to move us forward, he shared with me that he was struggling with whether leaving meant abandoning the team and abandoning me.

To this day, that loyalty and care fill my chest with gratitude for Todd. For his character and friendship. In spite of all we had been through together, and in spite of his belief that leaving might be just what he and his family needed, he did not want to abandon the team. And he did not want to abandon me.

We ultimately decided it was the right time for Todd to leave. And I am so glad we did. Not because of any impact it did or did not have on the company. But rather because his leaving marked the beginning of our rediscovery of our friendship.

I do not know if our friendship will ever be the way it was before starting the company together. But permanence isn’t a state we are capable of as humans anyhow. Who knows how our friendship would have evolved if we had never worked together. It is *different* now. But it is also rich, textured, and full of shared experiences. And it is still emerging and evolving.

We have had many conversations in the last few years about our time building Twenty20 together. We have expressed a lot of gratitude to each other for the journey. We have explored the ways we hurt each other and let each other down. We have shared our growth and the clarity that has come with it about why we were the way we were in our cofounder relationship.

We regularly speak now. Funny enough, we are both full-time founder coaches now. No doubt in part because of passion for sparing others the pain we experienced in our time as founders. And in part because of a continued love of the entrepreneurial journey and its power to drive change and growth.

Five things we got right:

There many things about the way we were and the way we began our work together, that I celebrate and would never change. Among those:

1. Choosing people we trusted. It was never a question that we trusted one another. For all the things that went right and wrong, we never argued about ethics or truthfulness. We always believed that whatever one another was saying was absolutely true.

2. Approaching the adventure with playfulness. I smile when I think back on those early Michigan trips where we drank beer, played cards, and dreamed together about what our future might hold. We were in it for the fun of it. To live near the beach and work with our friends. We did not do a great job holding to it, but I sure am glad we started there. What a beautiful beginning for a human-centric company.

3. Sharing a value of friendship > money. We argued about plenty of things, but with the confined exception of equity handling around Steve’s departure, we never argued about money. For a company started among friends that far exceeded our expectations, that’s damn impressive. I credit this to the shared alignment of values of friendship over money and also a shared rootedness in honesty and ethical behavior.

4. Establishing clearly-defined roles. We also never argued about who would own what. We talked it through, held the roles loosely, and got to work. We held a high degree of trust that when one of us said something was handled, it was handled.

5. Turning to forgiveness when things get hard. Even looking back, I am pleased with the conversations that have followed our respective decisions to stop working together. From all sides, there has been a commitment to forgiveness and reconciliation.

Five things we got wrong

There are also things I wish we could go back and do-over. Here are five:

1. Thoughtfully maintaining a friendship apart from work. When I coach early-stage founders now, we often spend time exploring the early days of their friendship or working relationship. Where did they find connection when times were spacious before there was this company between them? What activities, topics of conversation, or shared experiences created connection? Much like the importance of date nights and vacations for parents with kids, cofounders need to find a way to nurture their relationship apart from the company. I wish we had done better here. More camping trips without work talk would have been wondrous.

2. Aligning early on values. It feels crazy in hindsight, but I do not recall Todd, Steve, and I spending time talking about why we actually wanted to start a company. We did not discuss the way we wanted the company to impact (or not impact) our lives. We failed to agree on what we would sacrifice to make the company work and what we would refuse to sacrifice. If you do not make these commitments explicit, you end up with implicit compromises that are fertile ground for resentment. I recently published a list of questions I recommend all early-stage or prospective cofounders explore together; I wish we had.

3. Aligning early on ‘what success looks like’ It became clear a couple of years into running the business that we had different expectations of ourselves and the business. Our levels of ambition were not aligned. If you do not share the same North Star, it is easy to end up with misaligned incentives as the business grows. I wish we had talked more about how we were going to measure our success. Not just financially, but also in our team culture, in the experiences our families would have, in the career evolution we would each experience in the startup.

4. Creating a safe space for addressing hard topics. My wife and I see a wonderful couple’s therapist. Not because we have problems. On the contrary, we set aside the 80 minutes each week so that we have a dedicated space to explore difficult topics together with the spaciousness of a third-party present so that none of those topics *become* problems. It’s wondrous. I wish we had established a similar space with a therapist or a coach as cofounders. Developing the muscle of discussing loaded topics openly before they build up over time would have been great for us.

5. Discussing parallel paths for management vs. individual contributor (IC) roles at the outset. When you start a startup with other people, you are all cofounders. Over time, you take on other roles as well: CEO, VP of Product, etc. These are distinct roles and they should have distinct accountabilities even if they are owned by the same person. Also, when you are cofounders, you all start as individual contributors (IC’s). As the company grows, it’s a good fit for some founders to manage others. Other founders are happier and more productive as IC’s. We would have done well to discuss both paths early on and to ensure both paths were honored appropriately. A great CTO is wonderful. A great engineer or architect is equally wonderful. Management is not for everyone, and the ability to manage should not be the barometer for evaluating a founder. I wish we had done better here.

Gratitude to Steve and Todd

As I close out this post, I want to express my deep love and gratitude to Steve and Todd.

Thank you for taking the risk to begin the journey with me.

It was one of my life’s great honors to cofound a company with you.

You invited me to the CEO chair when I had very little idea what that role entailed let alone how to do it well. And you suffered through some of my worst mistakes in leadership. The leader I eventually became was informed greatly by your honest early feedback and by your friendship.

I am sorry for the many mistakes I made as your CEO and partner. I think part of my work as a coach now is a desire to make amends for those early errors. I know they caused you pain, and I am very deeply sorry.

I love you both.

The invitation

For those of you reading this who are at the beginning stages of your own cofounder journey, or perhaps trying to diagnose cofounder challenges mid-way through the journey, you have great opportunity at hand.

You can build the fundamentals now.

You can explore the difficult questions early when your roles and the organization are malleable and change is easier.

You can ask for help with the foundation building.

You are not alone.

If Sanity Labs can help, please reach out.

Todd and I are also workshopping a cofounder coaching workshop. If you would like to experience coaching designed by cofounders for cofounders, we would love to meet you.

Wherever you are in your own journey today, wishing you peace and ease.

-Matt