Written in collaboration with SISTAFUND, a European investment fund supporting startups founded by women entrepreneurs and gender-balanced teams.
What is it about?
Why is it important?
"The number one cause of premature death for a startup is the implosion of the founding team."
— Sam Altman, ancien président de Y Combinator et CEO d’OpenAI.
At the beginning of a business venture, studies show that the long-term success of a startup depends more on its founding team than its product.
3 actions to implement right now
1️⃣ Get to know each other personally: What are your expectations? Your values? The ambition of the project? Why are you looking for a co-founder now?
2️⃣ Begin the search for future co-founders
- Consider your close circle: it's among those with whom you have already collaborated that the founding team is most likely to emerge.
- Step out of your comfort zone by joining entrepreneur communities to meet new people and seek complementary profiles.
- Engage with incubation programs such as Entrepreneur First and Antler that integrate team formation in their support.
→ Focus on gender diversity:
- Teams with mixed founders have 1.4 times more chances of getting funded. (Source: 3rd edition of the SISTA x BCG Barometer, March 2022)
- Company benefits increase as the percentage of women in the workforce rises, up to 50%. For higher proportions of women, the relationship between benefits and the percentage of women remains stable. (Source: Study "The impact of gender diversity on the performance of business teams, Management Science, 2013)
At SISTAFUND, we only invest in startups founded or co-founded by women. In the latter case, we ensure that at least 30% of the shares belong to one or more women. Studies show that a numerical minority can only express itself effectively and autonomously in a group when it reaches a proportion of 30% (Study University of Pennsylvania, Damon Centola, 2018). For us, it is a fundamental, fair, and balanced element.
Natacha Brami, VC Associate @ SISTAFUND
Startups founded or co-founded by women are 2.5 times more profitable investments than others (they return 78 cents for every dollar invested compared to 31 cents for startups founded solely by men). — Natacha Brami
3️⃣ Clarify expectations from the start: Are you aligned on values? The project's ambition? How you work?
→ Write a shareholder agreement anticipating the worst-case scenarios, ESPECIALLY to prevent them from happening (see document: Defining the relationship between co-founders).
→ Consider the distribution of shares, which may not be the most pleasant exercise, but is necessary to motivate and incentivize teams.
- 📖 How to Split Equity Among Co-Founders (Y Combinator)
- 📖 Comment répartir le capital de départ entre les fondateurs ? (The Galion Project)
- 📖 Co-Founder Equity Splits—Ways to Approach Allocations (Harvard Business School)
📚 For further reading
🛠️ Founder Dating Playbook
📝 8 questions à se poser entre futurs associés (Maddyness)
- Do you share the same values?
- What are your expectations and desires for this project?
- What are your long-term life plans?
- What is your relationship with work?
- How do you react to difficulties?
- What are your skills and weaknesses?
- What are you willing to set aside for the success of the project?
- Create an informal framework to avoid scaring away your partners!
📺 Startup Partnership: Testing and Integrating a New Partner (documentary by Pylote startup)
📖 Studies with a focus on gender diversity
- The 3rd edition of the SISTA x BCG Barometer (March 2022) reveals that women create about 70% in mixed teams, while only 1 in 5 men start a venture with a woman. However, teams with mixed founders have 1.4 times more chances of getting funded and raise between €0.4M and €0.8M more than all-male teams in the early stages of funding.
- BCG's study Why women-owned are a better bet shows that while startups founded by women have more difficulty in securing funding, they perform better over time, generating 10% more revenue over 5 years.
- In the United States, First Round Capital, an early-stage investor, studied its returns from 2005 to 2015 and found that out of its 300 companies and more than 600 founders, "companies with a female founder outperformed all-male founding teams by 63%."
✍️ Contributors to this document
SISTAFUND is a new generation of venture capital funders backing exceptional female founders and gender-balanced teams.
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