Right out of college, I joined a startup. Within a month, they stopped paying my salary due to “cash flow issues.”
One of the co-founders was based overseas. The founders had only met a few times, and I could sense real tension between them. The distance and lack of alignment only made things worse.
Dysfunction at the Top
It reminded me of couples on the brink of divorce who believe having a baby will fix everything. Startup founders do the same thing. They try raising money or bringing in a new executive, hoping it will magically solve their dysfunction.
Unfortunately for me, I was that new executive.
When I looked into the accounts, I discovered money was being siphoned away. The remote co-founder was embezzling company funds.
Everything Falls Apart
When we confronted him, he locked us out of all accounts.
My boss, Jack (the local founder) turned out to be a victim too. Together, we poured every dollar of new revenue into legal fees.
But the deeper we went, the more it became clear: a lawsuit would drain us completely.
A Better Idea
Eventually, someone gave us the best advice we could have received: stop chasing the lawsuit and start building something new.
So that’s exactly what we did.
Me and Jack
Conclusion
What began as a disastrous startup experience turned into the foundation for something much bigger. Jack and I went on to build a new company together — and seven years later, we sold it for $780 million.
Here are the key takeaways from this article:
- Joining a dysfunctional team can feel like a disaster, but it can also lead to new opportunities
- Founders often try to solve deeper issues with surface fixes like fundraising or new hires
- Transparency and trust between co-founders are essential
- Sometimes the best move is to stop fighting the old battle and start building something new
What feels like a setback can be the starting point of your biggest success.