There’s a lot of truth to the saying that a successful business partnership is much like a marriage—two flawed human beings are joined in a committed relationship, with all of the ups and downs that are part of continual interaction with another person as you navigate life together. And, as in marriage, there are good partnerships and there are bad partnerships. Here is some trusted advice from several sources with expertise in a successful business partnership on how to best leverage such arrangements:
- The first step to a successful business partnership is putting in the time to plan and reflect on the future business. Everything from work responsibilities to profit sharing to strengths and weaknesses of each partner need to be considered, then carefully noted in a legal agreement. You should also have several “What If?” scenarios spelled out in advance, just in case one of them materializes. The best partnerships have been well thought out, so that when the starting gun goes off, the partners are ready to roll into action.
- Part of that planning involves a thorough recognition of the pros and cons of partnerships. Partnerships, or any business with multiple owners, are more likely to survive than sole proprietorships, reports the U.S. Small Business Administration. That is partly due to all of their advantages over solo acts, such as: leverage, shared cost of start-up, split responsibilities, division of expenses, complementary skills, larger network and, of course, the mutual encouragement that each partner can give to the other. The cons, too, must be figured into the equation before launching, among them: joint liability, shared profits, lack of total control, possible dissolution of a valuable friendship.
- Once you are knee-deep into the partnership, leverage it for maximum satisfaction and profit. One way to do that is to stay in constant communication, especially early in the partnership. Get as much input from each other as possible regarding your mutual vision for the business, for instance. You should have frequent brainstorming sessions to feed off of each other’s ideas. You also should interact often to hold each other accountable in effort. Many partnerships blow up because one partner begins to slack off. You should also establish committed relationship through a constant exchange of information. Keeping each other in the loop will only deepen mutual trust and strengthen the partnership.
- Whenever you encounter a difficult task or reach a stumbling block, ask your partner for help. Many times, you will discover that s/he has skills that you lack, that something that proves quite challenging for you will be a breeze for your partner. It also can help to have a fresh idea when you are faced with a true conundrum. Partnerships that do not take full advantage of each partner’s strengths and insights are not being leveraged to the max.
- “Forgiveness” is going to have to be a word that makes its way into your partnership. Each of you will make mistakes and take risks that do not work out. You must learn to quickly forgive each other when this occurs, rather than hammer the one who has made a mistake or committed an error in judgment. Just like in marriage, a committed relationship feeds on forgiveness which needs to be practiced on a continual basis so that your partnership will not cease to take risks and have the potential for explosive growth.
- It can be very difficult to evaluate how we are doing at a given task or on a given project. Take advantage of your partnership and get some feedback from your partner. Ask: “How am I doing with this? Do you have any suggestions? What would you do differently?” Don’t ask such questions unless you truly want to hear the answers, but if you do listen, you will become a more well-rounded person and a more effective partner. There is a good proverb in the Bible that says, “As iron sharpens iron, so one person sharpens another.” Let your partnership leverage and lead to your personal and professional sharpening.
By following the above tips, you will give your partnership a greater chance to succeed. A successful business partnership similar to (Gates-Allen, to name one) are a beautiful thing to see. May yours achieve its own distinctive history in business history.
“Coming together is a beginning, keeping together is progress, working together is success.” Henry Ford
Join our newsletter
If you like Critical Financial, subscribe and get our latest content via email.