Dear SaaStr: Why Do VCs Want to See At Least 2 Co-Founders?

First off, note that clearly it is possibly to build a huge SaaS company without a traditional co-founder.  It’s not the most common path, but now we can see that a number of leaders have done it: Zoom, Zscaler, New Relic, Fastly, Elastic, etc.  That doesn’t mean the founders did it all alone :). But it generally means they got it off the ground as the only true founder.

At the Top SaaS Companies, Founder-CEOs Own ~15% at IPO. And Most Co-Founders Are Not Equal (And That’s OK). UPDATED

Still I worry, and most investors worry, when a start-up lacks a co-founder.  For two reasons.

The main reason for me: I know how hard it is.

I know I did much better as a founder when I had a true co-founder than when I didn’t.  I know that later, when you can build a true team of VPs and SVPs (say $5-$10m+ ARR), a co-founder is still important, but less critical.

But there’s just too much to own in the early days, too many cliffs to jump off without knowing how far you will fall. Having a co-pilot for me at least makes the odds of success much, much higher.

When I had a true co-founder, nothing could stop us. When I didn’t, I still did well. But I was much more mortal.

And second, I really worry when there isn’t a great CTO on the team.

If the CEO is also the CTO, that can work.  But when it’s a driven CEO but with weak or outsourced technical team?  I just haven’t seen that work out well in SaaS>

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