Now that we’ve got that pesky election over, we can talk about what’s really important: why do VC’s hate solo founders? If there’s one thing that makes VC’s pass on a company, it’s the lack of a co-founder. Of my 32 investments, all but 5 have at least 2 founders.

Here’s why VC’s hate solo founders…

Single Point of Failure

If you’re a solo founder and you quit, my investment goes to zero. That’s one reason that single co-founder companies tend to have a higher mortality rate.

Multiple co-founders improves my odds. Even if one quits, there will be one or more to carry on and hopefully get me my money back.

Everybody Needs Somebody Sometimes

Building a startup is incredibly hard. You might want some help! And don’t forget, your competitors will have it.

The ideal team is a couple of coders and a good sales/marketing person. The engineers can build an awesome product and the third co-founder can go out and sell it like crazy.

But co-founders don’t just help with business. When emotions run high, they’re there as someone to lean on.

Failing On Your First Sale

Selling a talented person on leaving a secure corporate job and joining some fly-by-night startup is the first sale you have to make. It’s also one of the hardest.

When you show up without a co-founder, we start to wonder. “Did Jim just fail in making that critical first sale? What else might he fail at? Is he really a winner?”

Some founders stay solo by choice. But investors will often assume you’re by yourself because you couldn’t convince anyone to join you.

And If You Run Out of Money…

Startups have a way of running out of money. If you do, those salaried employees are out.

Only the co-founders will stick around. They’re incentivized by huge blocks of stock.

How to Find a Co-Founder

“How do I find a co-founder?” I can’t count how many people have asked me that.

I’d avoid the co-founder matching platforms. Someone you don’t know is a huge risk. If they don’t work out, getting rid of them is a giant pain.

Instead, think about the best people you’ve ever worked with. Then, go make the sale on joining your little startup.

When Investors Make an Exception

As much as I don’t generally like solo founders, I’ve invested in 5 of them. Why?

We are in the business of exceptions.

Every year, a handful of people will create a giant company. The only thing that matters in our business is to own a piece of it.

So, when we see an exceptional solo founder, we make the bet.

A fantastic solo founder might be someone who radiates ambition. They might be a really gifted salesman or engineer.

And of course, strong traction helps a lot in allaying concerns about that missing co-founder.

Looking at the 5 solo founders in my portfolio, they are a little more successful than average.

Maybe my filter is tighter for these companies. And maybe I should start doing more of these deals.

Wrap-Up

Being a solo founder makes raising money harder. It’s a problem, but it’s not insurmountable.

If at all possible, you should find a co-founder. But if you can’t, soldier ahead on your own and build something great.

If you’re exceptional, you’ll get funded regardless.

Do you have co-founders? Why or why not?

Leave a comment and let us know!

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