Unless you are immortal, every relationship has an expiry date. Unfortunately, none of us know when that will be nor whether the end will be peaceful or acrimonious. Founding a startup is a challenging and high-stakes endeavor, often compared to a rollercoaster ride. One of the most critical aspects of this journey is the relationship between co-founders.
A well-functioning partnership can drive the business to success. A harmonious partnership can drive success, while issues like underperformance, can create significant challenges. When passive-aggressive behavior is coupled with underperformance, the issues are magnified. Even in the best cases, when a co-founder is simply not performing, it presents a significant challenge. I’ve been through it, and if the issues are manageable and good intent is present, we can all emerge winning.
However, if one party handles relationships with passive-aggressive behaviors, the problems become far more complicated, and dealing with it is neither pleasant nor avoidable. Sadly, the damage done by the passive-aggressive individual can sometimes not be overcome.
Recognizing Underperformance
Identifying underperformance in a co-founder can be complicated. Symptoms might include missed deadlines, lack of initiative, poor decision-making, ineffective communication, distortion of facts, or a failure to contribute equitably to the workload. These issues can stem from various causes, such as personal problems, lack of necessary skills, burnout, or even a misalignment of the company’s vision and goals.
When the co-founder also exhibits passive-aggressive behavior, the challenge becomes more complex. While the initial symptoms are the same, passive-aggressive behavior manifests through indirect resistance to responsibilities, petty confrontations through non-compliance, refusals to disclose information, subtle sabotage, and negative attitudes masked as compliance.
The Impact of Underperformance and Passive-Aggressive Behavior
The impact of a non-performing, passive-aggressive co-founder can be severe:
- Operational inefficiency: Operations can be disrupted, leading to inefficiencies and delays.
- Team Morale: Passive-aggressive behavior will create a toxic work environment, demotivating team members and causing resentment. People stay but underperform and derive less than stellar satisfaction from their work efforts.
- Investor Confidence: Investors seek strong, cohesive leadership teams. A struggling, passive-aggressive co-founder can erode their confidence and jeopardize funding opportunities.
- Strategic Progress: Strategic initiatives stall as the cofounder incorrectly views attempts to assist as threats to their position. This impedes the company’s growth and competitive positioning. Inevitably, the organization fails. The best action for investors is to get out with what they can as soon as possible, as the outcome becomes inevitable.
Addressing the Issue through Open Communication
If the issue between founders is performance-related and not passive aggression, an honest and forthright approach can usually successfully resolve the problems. Unfortunately, If you are dealing with a passive-aggressive cofounder, their refusal to enter into communications precludes a positive outcome. In fact, you may discover that for many, all their behavior is at its core self-destructive, and it’s best to keep your distance. Let’s hope and presume you are not dealing with a passive-aggressive individual.
The first step to resolving any conflict is to have an open and honest conversation. These conversations must be broached; sometimes, you’ll discover that the timing is off. Just as you must choose the right time to open a sensitive conversation with your spouse, the same holds true with business partners. No one can read your mind to know what’s going on or what you need to discuss, so choose the right moment and the right approach. Approach the discussion with empathy. The person you are dealing with likely has contributed tremendously to your advances, but now there’s a challenge. If you ignore their contributions, you’ll start any discussion on the wrong foot. To be productive, you must focus on understanding your colleagues’ perspectives. If you can do so and present a balanced perspective on the situation at hand, then you’ve laid the groundwork for progress. When you talk, it’s essential to communicate specific examples of the challenges or underperformance and its impact on the company rather than making generalized accusations. But again, the person you are dealing with must accept responsibility for any performance issues.
Understanding the underlying reasons for underperformance is crucial. Is it a skills gap, personal issues, or a lack of motivation? Once the root cause is identified, you can explore solutions together. Sometimes, when people are struggling but believe others are dependent on them, they do not know how to ask for help because they believe, “I should know this.”
Help them overcome their fears. Reassure them that everyone is still learning and that you are there to support each other.
But if they refuse to acknowledge their mistakes and blame others, it is impossible to help them grow. Even without errors, when someone rebuffs all offers of assistance, it quickly sours the relationship and reflects horrible immaturity. It’s incredibly rare to find anyone successful who refuses assistance because, inevitably, these people self-destruct and drown.
In cases where direct communication fails to resolve the issue, consider bringing in a neutral third party, such as a business coach or mediator. They can provide an objective perspective and facilitate productive dialogue. If after all your efforts there is no improvement, it may be necessary to evaluate the long-term compatibility of the co-founder with the company. This is a difficult decision and should not be taken lightly. It involves considering the legal, financial, and emotional implications. I wrote an article referencing “good paper makes good friends.” This is when “good paper” becomes invaluable. Review the co-founders’ agreement and any legal frameworks for guidance in resolving issues. The resolution may be detailed in a shotgun clause or buy-out plan, or if not, it might involve negotiating a fair and minimally disruptive exit plan.
It’s essential to remember the human element in these matters. A co-founder relationship often extends beyond the professional realm into personal friendship. This dual relationship complicates resolving performance issues, as emotions and personal connections can influence decisions. Regardless, you need to approach the situation with empathy and respect, recognizing the emotional stakes involved for both parties. You both started the company and have an emotional attachment to it. You need to remember that they care, just differently than you do.
All that said, no matter the emotions involved, always remember that other people’s families depend on you both doing what is in their best interests.
If the relationship breaks down due to a divergence of opinion about company direction, you can still recover something valuable. Opening a professional and cordial discussion allows for a reset and unified approach that leaves everyone stronger. Dealing with a non-performing co-founder is one of the toughest challenges a founder can face. Ultimately, the goal is to find a resolution that serves the company’s best interests while maintaining the integrity of the professional and personal relationship between co-founders. If you both make the effort, great success can be found. But if either puts their own interests first, failure awaits.
However, If your partner begins to make decisions based purely on self-interest or operates in bad faith, your relationship becomes toxic, and eventually, the entire business is doomed. It’s a choice. Consciously or subconsciously, it’s a decision to alienate others, which is the definition of self-destructive behavior. When you confront this behavior in a business associate, you must find a way to either get out of the organization or get them out. Choose whichever option offers you and any other stakeholders the better monetary result. When you exit, your cofounder may win a pyrrhic victory, but they will inevitably fail. Unfortunately, they will likely have already failed in personal relationships as well. The pattern is apparent to everyone around them; either no one cares enough to help them, or they refuse to take any responsibility. Regardless, because they refuse to put in the hard effort required to self-assess and recognize their challenges, their behavioral issues will continue. Their behaviors will continue to result in a chain of broken relationships, both personal and professional. You’ll be glad you put them behind you.
With experience, we can plan how to mitigate the risks or damage done by the breakdown in any relationship. We entered into a relationship with good intent and for good reasons. Some of those reasons you came together will always remain and should be embraced. Not everything has to be lost. However, if one party acts dishonestly, refuses to take responsibility for their actions, or expresses no remorse, it can be almost impossible to overcome.
In the absence of betrayal, any disagreement can be discussed, and fences mended. What everyone learns from the experience can drive personal growth and corporate growth as well.