Tips for Starting a Business Partnership
While you may have been dreaming about being your own boss for years, being a solopreneur can be difficult and expensive. As a result, there are many great reasons to go into partnership in business, rather than start (or continue to run) a venture for yourself.
For starters, if you launch a startup with a partner, you automatically have the advantage of having more funds to run the business on, if they bring cash to the table just like you. This is very helpful for your organization’s finances, when every penny counts. What your partner brings to the table can also help your venture to be more attractive to banks and investors too.
In addition, when you join up with a partner, you’ll straight away have someone else to bounce ideas off, rather than having to wait until you can hire advisors or employees. You’ll have someone there to listen to you, and help pick you up on the hard days, when working for yourself just all seems too hard. This can, in turn, help you to make your venture a financial success sooner rather than later.
However, it’s important not to rush out and pick the first potential partner you meet. While there are many incredibly successful partnerships (think Bill Gates and Paul Allen, Bill Hewlett and Dave Packard, and Steve Jobs and Steve Wozniak), there are also many pairings which don’t work out so well. If you’re looking for some top tips for creating a partnership that will last for the long term, read on.
Ensure You Complement Each Other
First up, it is important to carefully consider the person you are thinking of partnering with, to ensure that the fit will be right. In particular, you need to examine whether you have complementary strengths and weaknesses. After all, there isn’t much point bringing on board a partner if you both have skills or experience in the same areas, and are lacking in others.
Study the best business partnerships over the years, and you’ll find that they are typically always made up of people who bring different things to the table. This then allows the group to become stronger together, as a unit. Keep in mind that you should discuss your most obvious key traits with each other, and the underlying assets that each person can bring to the business (such as time-management, communication, leadership, or problem-solving skills).
You should also talk about the types of jobs that everyone enjoys doing. While some people might have the ability to complete particular tasks, this doesn’t mean that they actually enjoy them, or that they will want to take them on in the business.
Give out Designated Jobs
Once you have analyzed the experience and skills of the various partners, it is time to give out designated jobs to each person. This allows people to concentrate on their own areas within a business and stay focused. By taking the time to designate roles early on, you will ensure that tasks don’t get overlooked, or that multiple people don’t end up working on the same items because there was a miscommunication about whose area of responsibility it is. (This is actually a common point of frustration for many partners).
If you find, after discussing it, that there are particular areas within your business that none of the partners can or wants to tackle, consider putting a plan in place to hire a contractor, outside firm, or employee to handle the work for you. In addition, keep in mind that roles can expand and change over the years, so it’s worth having an annual review to see if any responsibilities need to be reallocated.
Discuss Goals Up Front
Another thing that partners should do before they launch into a business together (and once it is up and running too), is talk about their goals.
Many fractured partnerships are caused because different partners want different things out of a venture, and they end up in conflict over what to do and/or how to proceed. This can all be mitigated though if you are transparent from the very start.
It is necessary to discuss both your short-term and long-term goals. This should cover not just each person’s hopes for the venture in general, but also personal goals, such as financial rewards, hours worked, location, and more. By discussing these things up front, you will be able to see if there are any potential red flags that need to be addressed.
From there, you might decide to come to a compromise; let each person get their way in certain areas; or decide to walk away because of your competing goals. The sooner these potential conflicts are found out though, the better it will be for all involved.