This is a conversation I often have with small business owners:
Entrepreneur: Should I partner with a friend to start a business?
Me: Would you marry this person?
A business partnership is not unlike a marriage.
What are the qualities you would hope for in a spouse? If you are married, what are the qualities that led you to believe you will spend the rest of your life with your spouse?
A business partnership is a long-term relationship with A LOT on the line. Entering a partnership should be made with the same level of commitment that one does when entering marriage.
Identifying A good partner…
Glen Blickenstaff recently wrote this list of 10 questions to ask when taking on a business partner for Inc.Com. (My notes are in orange.)
- What do each of you bring to the table?
- Do your morals and ethics align? (This is a BIGGIE. This will define the core structure and philosophy of your business.)
- What are the division of responsibilities? (Kelly addressed this last week on the blog. Click here.)
- How do you handle oversight of the other?
- Do you have an exit strategy if it doesn’t work?
- Are you willing to risk the entire relationship over a business venture? – Because you are. (Review Kelly’s pros & cons here.)
- Can you both be selfless? Can you putting more value on the venture and the other person than on personal gain?
- Is there sufficient reward, personal gain, to enter into this? That may seem contrary to the previous question but it really isn’t. This question isn’t about teaming; it’s about capitalism.
- How are each of you going to be compensated and what happens if you have to forgo a paycheck or even invest more in the business?
- Can you create a document that outlines everything above? (This is a partnership contract. You need one of these!)