Should I Get a Business Partner
By VICKY BROWN
Bootstrap, get an investor or get a Business Partner. It’s a big decision, and it will impact your business for the near future at the very least.
In an earlier episode we talked about the pros and cons around bootstrapping or getting an investor. If you missed that episode, I’ll put a link below – be sure and check it out later.
Today let’s focus on getting a business partner.
Now, if you do decide to join up with a partner, there’s a lot to navigate – so keep these important points in mind:
Determine who contributes what – no matter if it is money or sweat equity, or more likely, both – be specific about who is putting in what, and how much equity that gets them.
Track the money or time, or whatever earns the person the equity; and the equity that is earned at each trigger event (example: if you agreed that for each sale your partner closes in the first year they earn 1% equity – track when and what is earned).
Sit down together and figure out who will do what. What roles will each of you play. Maybe one will run the operations of the business, and the other will focus on sales. And, once those decisions are made, stay out of one another’s sandbox. Being given conflicting directions by the owners is confusing and aggravating for your employees, causes chaos for the business, and can cause resentment between the two of you.
“…Nothing is more damaging than one partner tearing down the other for a decision that was made. (No one wants to see mom and dad fighting).“
Align on your vision for the company, and its mission. Discuss goals, and timelines, and what you see for the business, and you, in the future. It doesn’t matter how hard you row, if you are rowing in opposite directions, no one is going anywhere.
Figure out what happens when you disagree about a company decision. Who, or what, will be the tiebreaker. And commit that once a decision is made, both people will wholeheartedly support it – particularly in front of others. Nothing is more damaging than one partner tearing down the other for a decision that was made. (No one wants to see mom and dad fighting).
You chose a service business because you wanted to help others. Coaching, counseling, providing professional services. But each day so many things are coming at you from all directions, you’re finding it difficult to stay focused on your vision in the overwhelm. In fact, these days you find it difficult to focus on anything at all. Everything is pulling for your attention – now!
Looking for a path up and out of the CHAOS?
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Get your legal house in order. Get a partnership agreement. I don’t care that you will have to spend money on a lawyer or lawyers (because you both should have your own) – get a partnership agreement. I don’t care that it will require you to talk about touchy and emotional subjects (good!) – get a partnership agreement. I don’t even care that you have known one another all your lives and are the best of friends and can finish each other’s sentences – get a partnership agreement.
Listen, like I said last week – all three of options (bootstrapping, investors or taking on a partner) have advantages and disadvantages. But you have to weigh the options and figure out what will work best for your business- and your personality. After all – whatever choice you make, you want to be happy.