Guest post in our entrepreneurial series. Enjoy! – Kimberly
Business partnerships between people who already know each other can be incredibly fruitful. They involve banding together and sharing capital, expertise, and experience to create a thriving enterprise. Partnering up with a friend or family member may seem like an excellent idea. However, you need to exercise caution when going into business with someone you are close to. Business partnership and friends do not always mix, and incompatibility in business can lead to strained relationships and broken friendships. Here are a few things that you should consider before choosing a business partner.
Photo by Sora Shimazaki from Pexels
Do You Share a Similar Vision?
If you are considering starting a business, you probably already have some idea about the product or service you would like to provide, the industry you want to be in, and the type of business you want to run. When it comes down to company identity, it is essential that you both share a similar vision for your brand. In order for it to succeed, business partners need to unify to fulfill brand promises, enforce standards and live up to the company beliefs and values.
Have You Worked With Them Before?
Having a strong connection with someone in a personal way does not always mean you will work well together in business. Being comfortable with your business partner and having the ability to be honest and straight with them is important. However, possessing existing experience working with them already will help you gauge their work style and what they will be like as a partner. If you lack this experience, try working together on a smaller project to see how you work together as a team.
What Can You Both Bring to the Table?
Sharing the same vision and having good rapport will only get you so far. In business, you want a partner who can fill in the gaps of knowledge that you might lack. Furthermore, business partners who work well together should both have invaluable skills to offer. Both party’s skills should complement the other, as this allows an equal distribution in workload. Your business will be more well-rounded and run more efficiently if you can both add value to the company in different ways. However, it is essential that you recognize when to seek professional help instead of taking a DIY approach. For example, business partners with no clue about software development should source a software company to do the job for them. ScrumLaunch specializes in software development, web design, and product innovation. With their expertise, you can benefit from a high-quality product and a scalable system.
Can You Agree on Ownership Percentage?
One major component of going into business with someone is agreeing on ownership percentage. Owning a business with one other person doesn’t mean you need to split everything down the middle. It could be that you are willing to take the lion’s share of the work while your partner takes on less responsibility. Whatever you agree on, having a formal agreement that is signed by both parties will prevent awkward conversations about board composition and equity allocation in the future.
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