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GiveForward's Ethan Austin on Why You Need a Technical Co-Founder

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There are so many things to consider when starting your own business that it's easy to miss a huge one: Do you need another co-founder?

Charity-minded local company GiveForward is a big advocate of companies having two types of founders: a business savvy one and a tech-savvy one. Although COO and co-founder Ethan Austin admits his company didn't follow this advice, he has a good reason: They didn't know any better. And he sorely doesn't want you to make the same mistakes he did, or waste time like he did in getting his fundraising service off the ground.

While emailing with Austin's director of IT, Chris McKeever on an unrelated topic for another interview idea that didn't pan out, Chris suggested I give Austin a call to further explore this typically overlooked area. (You can read my previous interview with Chris on how startups can protect themselves against hackers here.)

What sort of hiccups did you run into starting without a tech co-founder?

Ethan Austin: A lot of advice you hear on startup blogs or other people is that you should have one business person and one technical co-founder. I think we started with two business people who knew absolutely nothing about business. [Laughs.] We weren't off to the most auspicious start. In the beginning we were so naive that we didn't even know you needed a technical co-founder. I think we've certainly learned a lot more about startups in the last three years -- in the beginning we didn't know that much so we just dove in. We didn't have the money.

What we could've done is do it on equity and bring on a third, technical person. But we honestly didn't know how much of a difference that would make at the time.

Where would you find someone like that to help co-found a company if you don't have one in your network?

Ethan Austin: I'm talking to a lot of startups now who are doing that. A lot of single founders are actually asking me that same question. There's something called the Founder Institute. There's accelerators in Chicago, like Excelerate Labs, but there's also pre-funding companies to help single founders find other single founders. Those are good and helpful, obviously to get in there means someone has selected you.

Those are like incubators?

Ethan Austin: Yeah, they're like incubators but they're for really early stages, like the idea stage. A couple of founders will meet each other and decide whether they want to work together. Only a few people are going to get into that. For the majority of people, I think where they have luck is at networking events. There are other startup people there looking to do things and join teams.

We've seen companies start out of weekend events, like hackathons. There's something called Cloudbot that got put together at a hackathon. That's another option. I think most people, you just keep going to networking events. I just talked to someone yesterday who's technical but he's also looking for another technical co-founder, and he potentially found on the old way: A buddy of his from college is working at Microsoft and he's trying to get him to come down and work with him.

It's a tough thing. I keep getting a lot of questions [on this] a lot from people who are starting out.

What problems did you run into by not having a technical co-founder that others could maybe avoid?

Ethan Austin: We just went a lot slower. We had a development shop to help build the website in Chicago. With development shops, what happens is that we have a contract and inevitably those go over time. Three months turns into six months, and then you end up with a product that's late to market and you can't really make iterations on it because you paid for a fixed contract. Once you have something on the market and it's out there, it's out there, and you can't test it or keep improving it. You don't really know how good your product is or if the market even likes it until it's out there. When you have a fixed bid contract, you can't keep paying them to fix things and change things and make things better. You're kinda stuck with what you have for long periods of time.

Were there any advantages at all you could see to not have a technical co-founder? Or is it a huge mistake everyone should avoid?

Ethan Austin: We got through it in spite of not having one. I advise companies to go find one. One of my buddies last year asked what dev shop I'd recommend and I said, "Nothing against dev shops, but if you can, go find yourself a technical co-founder instead of working through a dev shop." You can just build so much faster than you can with dev shops. It's all about speed and getting things to market and getting them tested. That's the main advantage. For us, if we wanted to make some changes, we had to wait three months or save up money until we could afford to pay. So you're progressing at a pace that's glacial and doesn't allow you to make the changes you need to make when you need to make them.

We did it out of necessity. We were boot-strapping. We didn't have any money. We didn't realize we should've had a third person. That's what we could afford, so that's the way we did it.

What would you say is the average "getting to know you" period when you meet a potential technical co-founder? I'm inclined to think people can't decide about diving in together immediately.

Ethan Austin: I was literally talking about this with someone yesterday. It's that person who's bringing on a friend. There's a big advantage to working with a friend in that the most important thing between business owners is trust. You have to trust each other. It takes a bit longer if you don't know the person at all.

You want someone who can solve your problems and do cool things. If you're hiring someone in Chicago, a dev shop, or in India, or in Russia, they're gonna build stuff to spec. That means you're going to give them something, and they're going to build it as you requested. But bringing on a co-founder? They're going to think of ways to constantly improve your product and site. That's all they think about 24 hours a day, how they can make this awesome. When you have a dev shop, they're really just building to contract, to build what you want, and then move onto the next contract.

You don't want a developer. You want a hacker. In essence, a hacker is someone who is constantly thinking of how they can solve problems. Not someone who's just coding; someone who's coming up with creative ways to solve problems. A founder is going to be so much more invested in your company.

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