What to look for in a business partner
If you are thinking about entering into a new business partnership, it can be tempting to try and speed things along a bit to get the idea off the ground. However, it is certainly worth taking the time to decide if your potential partner really is the right person to go into business with.
We have looked at just a few of the considerations you need to make.
Do you trust them?
It is vital that you can trust your potential partner/s before you even think of starting a business. If you are not confident that they will carry out their fair share of the work, share important information with you or that they have the right attributes to help you succeed, the conclusion is simple “you should not go into business with them”.
Your potential partner/s must also be reliable, in so much as they will stick to a pre-agreed business plan and not make rash decisions without consulting you.
Even if you do feel you can trust them, a written partnership agreement is essential for setting out the rules of a business venture, and makes sure there are clear provisions for every eventuality.
In a business context, trust and reliability are not the same as friendship, and indeed some experts would advise against taking the gamble of starting a new business with a friend, as there is more pressure to succeed if you feel failure could have an adverse effect on your friendship. Of course, it is down to you to decide if this is a risk you are willing to take.
Can you work together?
The success of your business requires a good working relationship between you and your partner/s. A successful business takes time to achieve, so you should not start working with someone who is likely to start getting on your nerves after six months.
Particularly in the early days of a new business when you are unlikely to be able to hire staff, it will be down to you and your partner/s to make sure every necessary task is complete, and this may involve some planning on your part.
In fact, a more accurate question here may be whether or not you can work apart, as it makes no sense for all the partners to be focused on the same area and ignore everything else.
A sensible division of labour is a must, and that trust you have in your partner/s will allow you to press on with your share of the work without wasting time worrying about what is going on at the other end of the office.
For this to succeed, it might also be an idea to go into business with people who have different skills to you. This will allow everyone to play to their strengths and create a well-rounded partnership.
What happens if things start to go wrong?
While a partnership agreement will contain provisions for partners to exit the business if they so choose, ideally you will want to partner people who are prepared to make a long term success of the venture.
This means that if the partnership goes through a bad patch, you need to be confident that your partner/s will be as committed as you are to turning things around.
Ideally, your partner/s will not be afraid of speaking their minds if it will benefit the business, and you will all be ready to accept criticism and move forward decisively.
You can start to get a good feeling about whether a potential partner sees their future with your business idea by talking to them about their life goals in the early planning stages of your idea. If your ambitions do not match up, it may be time to look elsewhere. Asking these kind of questions before entering into a partnership with someone is much better than discovering this information when it is too late.
Ralli Partnership Law Solicitors can help you deal with many of the practical elements of starting a business partnership, so contact us today.