Picking Partners

Perhaps the most important thing you’ll do when starting a business is picking who you will have as partners. Sure, you could do it on your own. This would mean you wouldn’t need anyone’s approval on anything. However, having someone who cares to bounce ideas off of is very important. Your business’ decisions will be better thought out if there are multiple heads instead of just one. Diversity is key.

Another great thing about having partners is that it means you don’t have to do all of the work yourself. This may sound like laziness. It’s not. Starting a successful business is a lot of work even with multiple partners. Having partners means that you can specialize. There are many important aspects (well beyond the product) that go into a good business. I’ll go into this more in the future. If you have to spend all day figuring out how to make, get or store your merchandise, the last thing you want to do is also figure out how to sell it, or how to make sure you don’t go bankrupt. In fact, most businesses fail because there isn’t enough focus on one of these areas. If you have to do it all yourself, you are very likely to not have time to put the necessary amount of time into at least one these areas.

Another point when picking a partner is making sure you can get along with that person in the long run. You may be ready for long, hard hours, but what about your partner? Can your partner take care of projects on his/her own or is constant input required? Do you trust this person?

Deciding whether or not to partner with a friend or family member is a tricky question. Businesses are tough. Your business may not turn out to be successful. You don’t want to mess up your relationship. Consider if you think a serious dispute with your partner would affect your ability to be friends with them, both from your perspective and theirs. If they tend to get pretty emotional in a disagreement, you are probably better off choosing someone else. That doesn’t mean you can’t ask them for advice in the future.

On the plus side, it’s always nice to have some companionship when starting a business. There are going to be many days where you question whether you are doing the right thing and it’s always nice to have a friendly ear around when that happens.

The additional financial resources that a new partner may be able to bring to the table won’t hurt either. Though, partners don’t have to bring anything but their time. This all depends on the arrangement all of you decide on.

This brings me to my last point. Please, put the details of your partnership in writing. It’s not required by law, but it’s extremely important. Consider the following questions. Who gets paid how much and when? Who pays the costs and keeps the profits? How are decisions about hiring more people made? What happens in the event of a serious dispute or injury (hopefully not related)?