Starting and growing a partnership is a labor of love in more ways than one. On the one hand, you have this burgeoning business that ignites your creative flame and inspires you to do big things. On the other hand, you have another human being with a different set of skills, values, and philosophies that need to be considered. Partnerships are extremely rewarding and can be wildly successful, but it does require some careful planning and accountability to ensure both parties are equally invested in the business’ growth.
Oftentimes, partnerships are formed out of friendships or, at the very least, positive acquaintances. You like each other and you share a great idea, but a solid business partnership requires far more than affection. You have to balance your differences to determine whether you can realistically align in all aspects of a business, from money management to team expectations.
Although you may not see eye-to-eye on every single matter, it’s essential that partners can find common ground on the fundamentals of running a business together. Going into business with your bestie might sound fun (and it can be!), but it’s not a hobby anymore—your jobs, your livelihoods, and your relationship is now on the line. You have a legitimate entity and you must think about your partner’s needs on top of your own.
If you’re considering a partnership with anyone, here are some tips to get you started.
Learn about each other’s working styles.
A business partnership is like a marriage in many ways. It requires you to work together to build something spectacular, which often involves overcoming differences and conflicts. Partners do not have to have the same working style, but it’s vital to find a way to mesh and coexist peacefully.
If someone prefers to be a weekend warrior while the other needs to schedule their work around their family schedule, discuss what this will look like before signing any papers and making your working relationship official. The key is to set boundaries to ensure there is give and take on both sides so one person isn’t carrying the load all of the time.
Communicate early and often.
As with anything in life, preventing internal conflicts is far preferable to solving them. A healthy partnership is one that fosters meaningful conversations and maintains an open line of communication to ensure both parties are satisfied with the arrangement. Preventative measures help you avoid the common pitfalls associated with partnerships as it keeps everyone on the same page, even during disagreements.
Scheduling intentional check-ins provides an opportunity for both partners to discuss where the business stands, where it’s going, and how each of them contributes to the overall growth. It’s a chance to talk through pain points, find solutions, and mitigate risks before they take on a life of their own. Don’t lose sight of the fact that you have the same goal in mind, even if you view the journey through a different lens.
Discuss your current mindsets.
A lot of factors go into a successful partnership. While you don’t need to be on the same page in every facet, it’s critical to know that you share similar financial philosophies. For example, someone who tends to live outside of their means would not mesh well with a saver. Businesses are dependent on financial collaboration, so this type of misaligned partnership would inevitably lead to challenges.
Another aspect to consider is each partner’s capacity. How much time and energy can you each realistically invest in the business? Giving one’s “all” looks different to everyone based on their life circumstances, so make sure to have an honest conversation about the demands of starting a business together.
Prioritize the hard conversations.
Be wary of those who don’t think a contract is necessary or shy away from discussing the brass tacks of what it will look like to go into business together. If someone is resistant to having uncomfortable conversations before making it official, consider it a red flag to look elsewhere and protect your business interests.
There will always be conflicts in business, so you need to be certain that your partner knows how to handle a tough situation without adding more pressure or flying off the handle. Talk about how you’ll manage risk, whether you’ll give refunds, how you’ll respond to bad reviews, and other not-so-fun subjects to make sure you can both approach difficulties without being defensive.
Don’t cut corners on the contract.
It doesn’t matter whether you’re starting a partnership with a family member, a friend, or a complete stranger—you need a contract. This is not a matter of downloading a template or typing something up on a Google Doc. Get a lawyer and have them write up a legal document that covers all of the parameters of your partnership.
Who will own what percentage? What will your working relationship look like? How will major decisions be made? What happens if one person wants out? Who gets the first right of refusal to buy out others’ shares? What’s the process for dissolving the business? As you can see, there are a lot of factors to consider and a contract is the only way to protect both parties’ interests, much like a prenup before getting married.
Partnerships offer an incredible opportunity to build and grow a business with a like-minded colleague who feels as passionate about your “why” as you do. Some of the most creative and best business solutions come from partnerships! Don’t shy away from the potential of conflict, as the right partner will work through it with you. In fact, you’ll likely find that the beauty of a partnership actually lies in the conflict as it helps you grow stronger together.