Starting a business does not only require a brilliant idea, but also the necessary investments to get the ball rolling. While cash is the most obvious investment, other assets and time investments should also be considered important. It can be a heavy burden for one person to take on 100% of the business. A business partnership can certainly alleviate this burden by splitting up investments and responsibilities. But don’t just choose anyone. Your partner should be someone you are willing to work with every day, someone who shares your vision and brings a complementary skills to the table.
Here’s how to get started:
First, reach out to your professional network to compile a list of possible candidates. Using your own connections or evaluating referrals from trusted co-workers is a good way to start looking for a business partner.
Second, once you’ve found a good candidate, evaluate his or her personality, background, values and experience. While similar values are a plus, you should choose someone with a different skill set and background to complement yours. Having different skills allows you to split up duties and responsibilities more easily, get different perspectives on things, and ultimately learn from each other. Before jumping into a partnership, don’t forget to carefully vet your potential business partner. Resources such as social networks, company websites, former partners and other references shed more light on his or her background. Once your potential partner has passed this process, you should talk about how the business will be operated under this partnership. A written and legally binding Operating Agreement will create a framework for addressing disputes and each other’s roles in the company.
Third, making a partnership work is just as important as finding the right business partner. Make sure you stay in your lane and allow each other to handle the responsibilities you’ve defined in the beginning. To evaluate the ongoing partnership, establish frequent reviews. Without question, communication is one of the most important components of making a business partnership successful. Finally, pay attention to red flag. If something doesn’t seem right, address it in a timely and appropriate manner.
An Operating Agreement can provide the peace of mind you need to run your business smoothly. Find out more about our firm’s unique 4-step process of creating Operating Agreements.