Cofounder Selection & Satisfaction: How Entrepreneurial Cofounders Come Together and Succeed Together
Abstract
As many new ventures are created by teams, not solo founders, choosing a cofounder is an important decision for entrepreneurs. The individuals who mutually select into the founding team not only define and develop the concept, imprint the venture, and influence its chances of success, but also impact each other’s satisfaction and willingness to persevere. Yet despite these relationships’ crucial implications, the literature offers only scattered insights into how and why cofounders come together and succeed together.
With this dissertation, I advance theoretical understanding of what goes into forming and maintaining a quality cofounder relationship—a key resource that can neither be bought nor strategically acquired. The dissertation comprises three essays, including four convergent studies that each mobilize different forms of data, methods, and analysis. Essay 1 offers a systematic review of relevant literature, revealing that cofounder selection is a multilevel, dynamic phenomenon subject to many interrelationships. Drawing on systems theory, I organize findings based on four distinct initiation points, offering propositions about what predicts successful selection within each. Essay 2 examines how entrepreneurs’ selection priorities can influence cofounder satisfaction. After abductively deriving six key cofounder fit criteria, I test the model using fuzzy set qualitative comparative analysis, showing that there is not one necessary criterion, but certain configurations consistently yield high cofounder satisfaction. Finally, Essay 3 develops and tests a multilevel, relational theory of cofounder selection, which highlights that the benefits of choosing a high-familiarity cofounder depend on founders’ perceptions of psychological safety and equity justice with their cofounder over time.
As a cohesive set, these essays offer three overarching theoretical contributions to research on entrepreneurial team formation: i) establishing a systems view, which posits there are various ways in which cofounders come together amid a constellation of interrelated influences, advancing the field beyond assumptions of a linear, one-best-way approach to team formation; ii) developing dyadic reciprocity as a critical driver of selection and satisfaction, and illustrating methodological approaches to account for it; and iii) connecting selection decisions to key relationship dynamics, offering insight into the mechanisms by which cofounder relationships remain successful (or not) over time.