The number one way that startups in Y Combinator fail is through founder disputes and divorces. It often turns out that people cannot work together or one of the founders can't really work on startups at all. So picking who to work with is one of the most critical things you can do to ensure that your startup will get through the early stages.
Y Combinator applications just opened for this summer's class. It seems like a good time to talk about how Standard Treasury's co-founders knew each other and laid the foundation for sticking together, raising a seed round, launching a product, and building a good team.
My two co-founders and I know each other in much different ways that basically mirror the two ways one should find co-founders. With Dan, we have been friends for over a decade. We have discussed founding a company together for years. We know each others habits, strengths, and weaknesses inside and out. We knew we could work together.
With Brent, we knew each other for only months before we started working together and we were constantly assessing whether we could work together, figuring each other's style out, and ultimately deciding we could be partners carefully and over time. We vetted each other in-person and through friends and professional contacts. We came to know we could work together.
If you're going to found a company with someone, I'd suggest having one of these two stories: old friends or careful decision. I have never seen anything rushed or careless work out well for the startup or the team. I have never seen it work out just because folks can agree on an idea. Startups are more hectic and trying then that. In that way, the story of how I know Dan and Brent can be instructive to the ways one should know and vet their partners.
This is the first of two posts on building our team at Standard Treasury. The second post will be on our first three engineers. Building a team is the most important priority of a startup. With a great team, one can get through most troubles. With a bad team, even the best startups can fall apart.
Two Argumentative, Balding Friends from New Jersey: Dan and I
Dan and I met at Harvard Summer School in 2003. We were not instantly best friends. I remember quite vividly the first day of our first class, Introduction to American Government. Dan was then quite similar to how he is now, at least in this one respect: we met because he walked into the classroom and, without any compunction, began introducing himself to every single person in the room. I found it strange then and although I still find it strange now, I at least can see its utility. It is why Dan focuses on business development at Standard Treasury.
I was particularly annoyed though, when I showed up to my second class, Introduction to Political Philosophy, and there Dan was, introducing himself to everyone in that classroom as well. We were the only two students who took these same two classes.
Despite whatever feelings I might have had that first day, in retrospect, it seems obvious that we were going to have a full and long-lived friendship. We were both from New Jersey, and then, as now, we have a mix of tough-guy go-fuck-yourself, sarcasm as humor, insatiable curiosity, intellectualism, and ambition.
I have this theory that lots of founders have childhood trauma (or, at least, difficulties), that motivates them towards the implausibly difficult task of building a startup. A part of my deepest friendships come from a common, shared understanding of something difficult: in Dan's case, the tragic death of his father and serious injuries to his mother in a car accident when he was an infant, and in my case, my mother's alcoholism and disappearance from my life for ten years.
The important point here isn't the particular personal details of our childhoods, though. As Dan and I got to know each other that summer, we bounded over our similarities in affect, goals, and histories. We spent a lot of the summer together, studied together, explored Cambridge and Boston, and became good friends.
Harvard ended but geography kept our friendship alive. We only lived thirty minutes apart in New Jersey. We would hang out, from time-to-time, throughout our senior year, and like all teenagers of that era, we spent a lot of time chatting on AOL Instant Messenger.
It's hard to understate or understand the intensity of our friendship from there on out. We went to different colleges in different time zones. We saw each other maybe twice a year in person. But Dan was among five or six friends that I talked to nearly every day (and I feel bad that I don't have a reason to write blog posts about them all!), and one of my closest friends.
We usually simplify our friendship by referring to the month we spent together in India in 2006. It's a good synecdoche. I had a fellowship from Brown in the summer (I think I successfully had them pay me, to do what I wanted to for every summer), and Dan was traveling on to Nepal and Tibet with a UChicago group. We visited Delhi, Agra, Jaipur, and Varanasi together as poor college students. We got very sick together, rode elephants together, visited the Taj Mahal together, got lost together. It was fun, but, at times, stressful. We learned a lot about our friendship through that sort of travel. We figured out, I think, that we could work together.
After college, Dan moved to San Francisco, I moved to New York. We pursued what appeared to be quite different career paths. Dan in tech, me in government. But we're both passionate about many subjects and my interests moved closer and closer to data science and civic technology over time.
Dan and I had spoken many times about founding a company together. Whether it was the naive thoughts of two sixteen year olds or the more mature (I hope) reflections of two old friends separated by thousands of miles, it has been often in our minds. So, when I decided that I wanted to move on from the Mayor's office in Newark, NJ, I decided to pursue my interest in technology more directly, by moving out to San Francisco, working at Stripe, and being closer to my old friend Dan.
Being old friends is one model of finding your co-founder but another is meeting each other through trusted friends and deciding you can work together after getting to know each other quite intensely. That's the story of working with Brent.
Bringing on Brent: Third Co-Founder and CTO
The cornerstone of our team at Standard Treasury is our third co-founder and CTO: Brent Goldman. He joined Dan and I during Y Combinator. He came highly referred from a friend (and many others), studied computer science at Caltech, and worked at Facebook on Platform for four and half years.
If you know Standard Treasury today, you know Brent. Brent and I work together on every product decision, as PM and EM, while Dan sells banks..
Dan and I were first introduced to Brent in February 2013. A friend told me that Brent and Dan were his two smartest friends and that they were both thinking about starting companies.
When we first met, Brent was kicking around some great ideas and, in fact, had another potential co-founder he was working with on them. Dan and I had thoughts about Standard Treasury (then without a name) in ways that were much like our original YC application, which was filled out around the same time.
But, when we met in February, we were all casual. We hadn't incorporated Standard Treasury. Dan was still at Giftly, I was still at Stripe, and Brent was working with another co-founder. It seemed then that the timing would not work out well for the three of us to work together, although we all ended up liking each other a good bit. At the time, I remember being pretty sure that I would be at Stripe for four years!
Despite Brent’s immense interest and experience in platforms, in these early days we were just feeling each other out (and aligning calendars - including a month-long trip to New Zealand). Brent tried to sell us on some of his ideas, but Dan and I knew what we wanted to do as YC had already offered us a YC interview on the idea. I'm not sure we could sell remaking commercial banking well at the time — it is boring to the uninitiated.
What we found, though, was a lot of group chemistry — what we've come to call "founder chemistry." Our skills complemented each other, and ideas were flowing. The only issue was that we didn’t know each other and we didn't know if we could work well together long-term. Founding a company together is like a serious relationship and this was just the first date.
Over the next couple of months, as Dan and I left our respective jobs and got in to YC, Brent, Dan, and I met up every couple weeks to expand on our ideas, swap war stories, and discuss philosophies about what kind of company we wanted to run. Over time we realized that we could work together, and that we could found a company together.
So we joined forces.
Brent fills out our skill sets and together we're all well-complemented. I often joke that on almost everything (technical skill, financial knowledge, desire to talk to investors, ability to write clearly, attention to detail, etc.), that between the three of us, two of us are always at opposite ends of the spectrum, with the third acting as the mediator. It works well — it's just the right level of tension and conversation between us.
Most importantly, Brent puts engineering excellence above almost everything else and has the experience in shipping code and mentoring engineers to back it up. He's instituted a thorough code review process, sets the technical direction, and works with everyone to build sustainable, maintainable systems.
But, despite his perfectionism and attention to detail, he's also a pragmatist who will do whatever it takes to get things done — whether it's re-prioritizing or cutting features, accumulating technical debt (the right kind, with a sound plan to pay it off), or leading the charge to the long hours necessary to meet a tight deadline.
Brent is a force multiplier for engineering productivity and has infused our company with the engineering-focused culture we always knew we wanted. We lucked out in finding the right co-founder to help us build it.
Growing the Team
Just as we were formalizing our relationship with Brent, we finalized two more engineering hires. They are both dedicated and productive, and both snapped to the engineering culture Brent wanted to build. Then Brent brought in an old colleague from Facebook to fill out the core team. It's been the six of us together until our first new hire last month. We've found that we not only have an amazing team but one that is very cohesive.
In my next post I'll talk about how to find a team, what kind of team one needs to build for a successful startup, and how we did it at Standard Treasury.
 I even have a half-written, unlikely-to-be-published blog post on this topic, and how much I validated it through my dozens of close friends in YC. It is a hard thing to write about because it's deeply personal and it opens you up to a common line of attack: well, I had or have it worse.
 The division of responsibilities and founder relationships is another planned post.