Before I started Simplegrid, I had actually started another IT consulting firm, which completely failed. This firm was started with 7 friends who were all interested in working together. We realized very quickly that this model wasn’t going to work. All of us had overlapping skills sets, and didn’t have the complimentary skillsets that are needed for a business to succeed. For example, we were all technologists, but no one had sales or administrative experience.

Beyond that, we were suffering from too many cooks in the kitchen syndrome, so all seven of us had to agree in order to make a decision to be finalized. It would take us weeks to come to a decision on something as simple as to where to open our bank account. Lastly, since we were all friends, no one wanted to step on each other’s toes, and no one wanted to do the more mundane work that is needed in the beginning stages of a business.

I was very serious about starting a IT consulting firm, and saw it as a big part of my career, so I had to make a tough decision and let my friends know that I wouldn’t be working with them, but rather starting my own firm.  It was a tough time as many feelings were hurt.  I learned a lot of lessons from this one failure, that I think can be applied to all businesses:

• Never start a company with more than 2 or 3 (max) co-founders.   If you do have co-founders, make sure that each of you have complementary skill sets.  For example, if one of you is the technical one, the other should have a strong skill set in sales.
• Try not to go into business with your friends.   Unless you can separate out the business aspect of your lives, from the pleasure aspect of your lives (and believe me, not many people can), you’re looking for trouble as issues in your business will spill over into your personal lives.  Do you really want to involve your other friends, or even your families in your business issues?  Do you want to go to a party and be upset because your partner isn’t pulling his weight, but you can’t tell him that cause he’s your friend?  It’s a really bad idea.
• Fail fast.  You’ll know when the writing’s on the wall.  In my situation, it was obvious that this firm wasn’t going anywhere.  It’s always better to cut your losses and try again.

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