Choosing a business partner is a bit like choosing your spouse. And like an unhappy marriage, if you make the wrong choice, you can set yourself up for failure. If you want to stick it out for the long run, you should select someone whose skill set complements your own and with whom you are comfortable working.
You don't want to rush into a business partnership. That can be an expensive recipe for disaster. Read on to learn some tips for choosing the best business partner for you and your next entrepreneurial venture.
Can you trust the person?
If there is no trust between partners, the business is almost certainly doomed. Get to know the person and see whether this individual is trustworthy.
The friendship dilemma
Just because someone is your good friend does not mean that he or she will make a good choice for your business partner. You should first ensure that your friend shares your values and goals for the business. Then, ask yourself if he or she is responsible. Is your friend's personal life a train wreck? That chaos can bleed over into your business dealings and create problems.
Take the partnership for a test drive
Before you finalize your partnership, consider doing a trial run for a few months to see how well you work with this person.
Do you have complementary skills?
If both of you are great at sales and neither is good with administrative tasks, who will handle all of the operating duties? Choosing someone with opposite strengths than yours achieves balance.
Define your roles
Knowing and understanding your role and responsibilities to the business and partnership are crucial for success. Make sure to include a description of same in the contract you and your partner sign.
Another important thing to do is decide ahead of time how to distribute the profits from your joint venture and include it in your partnership agreement.
Draft a comprehensive contract
Make sure that your contract contains an exit clause and a buy/sell agreement in case one or both of you want to get out of the business. Your Cincinnati attorney can draw up an agreement that covers all bases.
Source: Entrepreneur, "8 Critical Considerations for Choosing the Right Business Partner," Pamela Wasley, accessed March 23, 2018