-By Mike Mulhall, The Entrepreneur
Going into business with a partner is a lot like marriage, so treat finding one like dating. The last thing you ever want to do is jump into a financially committed “relationship” with someone you don’t know well. I’ve made that mistake more than once, and it can be devastating financially and emotionally.
Business partners are going to go through a lot together. That’s just the nature of business. The partnership will be tried, tested, stretched, pulled and stressed to the limit. Therefore, compatibility on multiple levels is crucial. Partners should be comparable in reliability, intelligence, financial stability and character. Those are the four big qualities I’d focus on, but there are many more.
Don’t let the excitement of starting a new business cloud your judgment when considering a partner. I’ve seen many people make fatal decisions because of hope and inexperience.
Here are a few pointers for finding and maintaining a good partnership:
- Family members don’t make good business partners. We’ve all heard it, but most of us ignored it until it was too late.
- Make sure the risk is split fairly between partners. Financially lopsided partnerships experience even more pressure.
- Don’t be afraid to run a background check. If I had done that with my very first partner, I would have saved myself a fortune.
- Ask around town. A person’s reputation can tell a lot about them.
- State the goals, duties and expectations of each partner (in writing!) before commencement of the business.
- Hire a lawyer to protect your interests and ensure the partnership is fair. I know this sounds aggressive and expensive, but it will save you should things go sour.
- Create a strategy to maintain high levels of communication and interaction between the partners. Weekly or even daily meetings are a must.
- Maintain non-business interactions as well. Periodic dinners and recreational events are great ways to ease any tension that may be present.
Remember that good partnerships can be beautiful while bad partnerships can be ugly and life altering. So tread carefully, don’t rush into things and always trust your intuition. You wouldn’t marry a stranger (I hope!), nor would you enter into one of the most important business relationships of your life without doing your due diligence. This is probably the most important advice I could ever offer an entrepreneur.