How to choose your business partners



How to choose your business partners


Choosing the right business partners is not something that can be guaranteed. However, some measures should be applied so as to avoid repetition of previous experience that went bad.
In most cases people prefer to go into business ventures alone due to a certain bad experience they have had trying to work with partners. This is actually simple: As president and chief executive, you'd have the authority to make crucial decisions regarding the position of the company without necessary having to reach an agreement with other members of the board. Of course, this can be a good thing or a bad thing, depending on whether you work better as a consensus builder or as a maverick. If you're a sole proprietor you can brainstorm with employees and advisers, but ultimately company decisions and responsibility will rest on your shoulders.
The benefits of starting a business by yourself include not sharing the business's rewards, not risking potential partnership problems like you've experienced, and not having to share control and recognition with another person," says Phil Holland, chairman and founder of MyOwnBusiness.org
But if you decide to go with partnership, you should be able to share responsibility and commitment with a partner, as well as benefit from your partner's hard work, capital contribution, and unique skills and strengths that should complement your own.

TIPS ON GOING INTO BUSINESS PARTNERSHIP




Take your time: You can't get to know someone in one conversation, or even in several conversations over three or six weeks. It may take months to thoroughly understand and professionally vet another person, but the more you can discuss up front, the better. With a better choice of partner you can start your company earlier time than the month planned. 

Assign roles and stick to them: When you do choose a business partner, clearly define the function each of you will fulfill in the company. This way, everyone will have a clear definition of the role and contributions he or she is to make. Stick to what you know, and let your partners take charge of what they know and are good at.

Be coldly objective: Try to evaluate potential partners without regard to emotional ties or friendship. Draw up a set of criteria that you're looking for and simply judge how well a potential partner lives up to it. Think about the skills you need in a partner and the personality traits you can and can't work with, and dig for answers to those types of questions before you proceed to doing business with them. But most importantly, pick someone who is as excited and as driven as you are to make this business idea a success."

Do background checks: All potential partners should submit to a background check that will turn up any past dishonesty, substance abuse problems, or criminal violations before they go into business together. Each should also provide a list of professional and personal references the other can talk to before entering into any agreements. Partners should be forthcoming about their financial situations, creditworthiness, assets, and debt.

Institute legal safeguards: Whatever agreement you come to, put it in writing in a formal partnership agreement. A lawyer can help you build important information into such an agreement. This agreement can include the following; how work will be divided, what will happen if more startup money is needed, and how decisions will be reached. Having incomplete agreements is not safe for the business.

Don't duplicate yourself: If you're a great idea person but have no head for numbers, join up with a financial wizard rather than another creative type. "You should share a sense of vision and values but not have overlapping skills," says Jonathan Goldhill, CEO of the Goldhill Group, an entrepreneurial consultancy in Agoura Hills, Calif. "The biggest problem I see is two people who are very much alike getting into business together. They may both be skilled technically, but neither is a door-buster or a rainmaker, and that's what they need to create a business.

Share financial commitment. Don't go into partnership with someone who doesn't put money, or something of equivalent financial value. An equal capital commitment "decreases the chance of a partner suddenly walking away from your business, leaving you with all the responsibilities.





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