About This Episode

In this candid conversation, Patric and Shub explore one of the most challenging aspects of building a startup: when co-founder relationships break down. Using the financial concept of "decay of credit worthiness," they discuss why founder misalignment becomes more likely over time, how to recognize the warning signs, and practical strategies for addressing performance gaps before they destroy company value.

In This Episode

Why founder teams with 4+ members face over 50% likelihood of co-founder conflict over a 10-year period

The "decay of credit worthiness" framework: how co-founder compatibility naturally erodes over time due to changing circumstances, ambitions, and external pressures

Warning signs of founder misalignment, from skill gaps to diverging values, and why close personal relationships can actually mask performance issues

Practical communication strategies for addressing co-founder concerns, including the importance of identifying bottlenecks before escalating to difficult conversations

How to seek objective outside perspective when evaluating co-founder situations, including the specific criteria for choosing the right advisors

Timestamps

(00:00 ) Introduction and casual banter(02:12 ) The founder misalignment problem: why it's a top cause of startup failure(03:58 ) The "decay of credit worthiness" metaphor explained(07:50 ) How to re-underwrite your co-founders over time(10:51 ) Can investors spot founder misalignment from the outside?(13:15 ) Why founders avoid confronting co-founder issues(14:52 ) How team size amplifies risk: from 2 to 4+ co-founders(17:00 ) The dangers of founder cliques and investor camps(19:44 ) When close friendships create blind spots(23:14 ) Communication strategies: starting the difficult conversation(25:59 ) Identifying and solving bottlenecks before escalating(29:24 ) Why adjusting compensation doesn't fix fundamental mismatches(32:00 ) Finding objective advisors: the four critical criteria(36:42 ) Conclusion and final advice

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Patric Hellermann: ⁠⁠https://www.linkedin.com/in/aecvc/⁠⁠

Shub Bhattacharya: ⁠⁠https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/⁠⁠

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