This is a summary review of The Founder’s Dilemmas containing key details about the book.
What is The Founder’s Dilemmas About?
The Founder’s Dilemmas is the first book to examine the early decisions by entrepreneurs that can make or break a startup and its team. It draws on the inside stories of founders like Evan Williams of Twitter and Tim Westergren of Pandora, while mining quantitative data on almost 10,000 founders. People problems are the leading cause of failure in startups. This book offers solutions.
Who is the author of The Founder’s Dilemmas?
Noam T. Wasserman is an American academic. He is currently the dean of the Yeshiva University Sy Syms School of Business. Previously, he held the position of professor of clinical entrepreneurship at the University of Southern California and the director of USC's Founders Central Initiative.
What are good quotes from The Founder’s Dilemmas?
“A friendship built on business can be glorious, while a business built on friendship can be murder.”
“IT’S UNFORTUNATE BUT TRUE: IF ENTREPRENEURSHIP IS A BATTLE, most casualties stem from friendly fire or self-inflicted wounds.”
“Aside from the parent-child relationship, we do not expect our relatives and friends to have any more power over us than we grant them out of respect or affection.”
“What they don’t teach you in business school is to make sure your life partner is in sync with what you’re doing,”
“Founders who consistently make decisions that build wealth are more likely to achieve what I call a “Rich” outcome (greater financial gains, lesser control), while founders who consistently make decisions that enable them to maintain control of the startup are more likely to achieve what I call a “King” outcome (greater control, lesser financial gains).* Multiple”
“Multiple studies have confirmed that these two motivations are the most common. In the Kauffman Foundation’s study of 549 founders of American technology startups, 75% of the respondents said that building wealth was a very important motivation for becoming an entrepreneur and 64% said the same of wanting to own their own businesses.16 Likewise, the Panel Study of Entrepreneurial Dynamics asked 1,214 respondents about their motives for starting a business. The top six motivations were control motivations, such as freedom to take one’s own approach to work and fulfilling a personal vision, and wealth-building motivations, such as gaining financial security and building great wealth.17 The CareerLeader”
“The most effective boards give independent, informed advice to management and challenge the CEO, rather than acting as a rubber stamp.”40 Ideally, says one VC, “Boards should be encouraging the type of learning to allow a company to ‘pivot’ by making important changes in its strategy.” To the extent that some founders have trouble focusing on a single idea rather than pursuing new projects, boards can also serve as a check on that tendency.”
“All told, entrepreneurs earned 35% less over a 10-year period than they could have earned in a “paid job.”
“As Bagley and Dauchy suggest, “The most effective boards give independent, informed advice to management and challenge the CEO, rather than acting as a rubber stamp.”40 Ideally, says one VC, “Boards should be encouraging the type of learning to allow a company to ‘pivot’ by making important changes in its strategy.” To the extent that some founders have trouble focusing on a single idea rather than pursuing new projects, boards can also serve as a check on that tendency.”
“Setting the early equity split in stone, without allowing for changes, is one of the biggest mistakes founders can make.”
“Founding a startup is akin to a wedding, a declaration of mutual devotion. It seems inappropriate and even counterproductive to plan for a breakup, yet in entrepreneurship, failing to make the prenup part of the wedding vows, so to speak, can prove disastrous.”
“Teams of prior coworkers were significantly more stable than both teams who had a prior social relationship and teams of strangers.”
- Print length: 496 Pages
- Genre: Business, Entrepreneurship, Nonfiction
What are the chapters in The Founder’s Dilemmas?
Chapter 1: Introduction
Chapter 2: Career Dilemmas
Chapter 3: The Solo-versus-Team Dilemma
Chapter 4: Relationship Dilemmas: Flocking Together and Playing with Fire
Chapter 5: Role Dilemmas: Positions and Decision Making
Chapter 6: Reward Dilemmas: Equity Splits and Cash Compensation
Chapter 7: The Three Rs System: Alignment and Equilibrium
Chapter 8: Hiring Dilemmas: The Right Hires at the Right Time
Chapter 9: Investor Dilemmas: Adding Value, Adding Risks
Chapter 10: Failure, Success, and Founder-CEO Succession
Chapter 11: Wealth-versus-Control Dilemmas
What do critics say?
Here's what one of the prominent reviewers had to say about the book: “Highly recommended for those who plan to embark or are already living the entrepreneurial lifestyle, it can serve as a guide to very tough situations for founders to evaluate the best possible way out.” — Bernard Leong, SGEntrepreneurs
* The summary points above have been concluded from the book and other public sources. The editor of this summary review made every effort to maintain information accuracy, including any published quotes, chapters, or takeaways
Tal Gur is an author, founder, and impact-driven entrepreneur at heart. After trading his daily grind for a life of his own daring design, he spent a decade pursuing 100 major life goals around the globe. His journey and most recent book, The Art of Fully Living, has led him to found Elevate Society.