Launching a business partnership is a major move. It has the potential to work out well. However, in a worst-case nightmare, it could sour your company’s prospects and reputation. It can also burden you with messy hassles or even litigation.
Picking a business partner is not a choice to make casually. It requires careful, objective thought. Your emotions can’t muddy the picture. A dear friend or family member might be a terrific person, but a bad fit for the position as a business partner. You might actually be better off doing everything solo. Not everyone requires a business partner.
Faulty objectives for establishing a business partnership
There is a lot to mull over when you decide to establish a business partnership. Your business partner will ultimately have a great deal to do with the success of your venture or its downfall.
Furthermore, you might not need a partner as much as you assume you do. Don’t impulsively get embroiled in a partnership that could eventually drain your energy.
These are some shaky rationales for obtaining a business partner:
- You want a partner because they can provide the expertise you don’t have. Just get a new employee or two, instead.
- You think a partner will help to shoulder some of the responsibilities of the business. This may seem like a logical course now, but it’s actually a weak strategy.
- You’re trying to build a network. Don’t rely on a partner to let you tap into their professional network. Create one of your own.
- You need an infusion of money, so you bring a partner on board who can supply it. This can spark “resentment and power struggles.”
It’s hard to foresee the future
As in any relationship, it’s impossible to know in advance how things will work out. After a reasonable length of time, however, you should know if your partner is the best person for the job or if you even need one. If the person is unsuccessful and the business partnership is struggling, you might want some professional guidance on how to proceed on your own.
Notice: We are providing this as general information only, and it should not be considered legal advice, which depends on the facts of each specific situation. Receipt of this content does not establish an attorney-client relationship.