Before committing to a business partner, determine the expected business structure and the reason for picking the partner.
When running a business, several problems can be solved by having a business partner on board. He or she can bring in new insight and experience, financial support, and even a ready market for your products. However, before bringing one on board, it is important to be sure the business partner fits with the business and will actually propel it forward. Below are seven questions you should ask before committing to a business partner.
1. What Will Be the Structure and Ownership of the Company?
At first, when business partners come to do business, there are usually no problems. However, as the business starts to make a profit, the fights for finances and control cause squabbles. Some degenerate into court cases and breakups. It is important to define the ownership of the company and the legal structure you will take after accepting the partner. If the partner agrees to the suggestion, determine what is to be done if they or you decide to leave.
2. Does the Partner Share Your Vision and Goals?
You have to be looking the same direction for the business to stand. Ideal business partners embrace the founder’s vision and run with it. Moreover, they can sit and come up with common goals for the business. A partner can shape things up and make a few changes to the business. However, you should be on the same page so you work on same long-term goals with enthusiasm and passion.
3. Are You Ready to Give Part of the Control?
One of the issues that causes a breakup in business partnerships is the control of the business. When you are alone, you are at liberty to make business decisions at will. However, when a partner comes in, you have to consult, especially for critical decisions and choices that take up a significant chunk of business funds. You should be ready to accept a ‘no’ to some of your ideas and consider new thoughts from the partner.
4. Why Do You Need a Business Partner?
A business partner will help you perform some work as you focus on other issues. For instance, he or she can be helping you run daily business activities as you look for more funding. He or she may also come with expertise and experience essential for your business. Your reason for looking for a business partner should determine which responsibilities fall to them.
5. How Does the Partner Deal With Conflicts?
Startups and big businesses experience conflict from time to time. It is important to know how a partner deals with conflict either with yourself or members of staff. Otherwise, simple issues may drag on the business or end up sinking it. An ideal partner should share your values and beliefs so conflict resolution becomes easy.
6. Is the Partner Stable Wherever He or She Is?
Family and financial matters play a role in the smooth running of a business. Is the partner financially solid? Is his or her family stable? While family troubles may not necessarily strike out a potential partner, it is important to gauge if the partner is stable in his or her life.
7. Can We Multiply Our Efforts Together?
What is the value of the gain you intend to have from bringing on a partner? Is it worth the trouble of having the partner? Will he or she help propel and meet startup expectations? Bringing a partner should come with tangible benefits. Otherwise, it may not be worth the trouble.
A business partnership works like a marriage. The choice of a business partner determines the direction of the business. Take time and pick a partner who helps you achieve your vision and mission.
