What should i look for in a business partner
Just like marriages, business partnerships often run into rough waters. Does your partner dream of starting the next Starbucks, while you envision a part-time catering business that gives you plenty of time with your family? You and your partner must share the same core values, goals and work ethic if you want the business to succeed. When you and your business partner have different strengths, you'll double the power of your startup team right off the bat. For example, a shy tech expert who wants to start an Internet business would do well to find a partner with sales, marketing and people skills.SEE VIDEO BY TOPIC: Tips for Picking a Business Partner
SEE VIDEO BY TOPIC: How to Pick The Right Business Partners - Dan MartellContent:
- Choosing Your Business Partner Wisely
- 10 Things to Look for in a Potential Business Partner
- 6 Qualities to Look for in Business Partnerships
- 8 Critical Considerations for Choosing the Right Business Partner
- Top 10 Qualities to Look for in a Business Partner
- 7 Simple Steps to Identify an Ideal Partner for Your Business
- 10 Qualities of Successful Business Partners
- 7 Tips for Making a Business Partnership Work
- Qualities to Look for When Choosing a Business Partner
Choosing Your Business Partner Wisely
According to recent studies, two-thirds of all businesses fail. This means that a business has less than a 1 in 3 chance of succeeding. The first place to start when looking for a good partner is to assess your own strengths and weaknesses. Once you have done that, you can look for a partner who exhibits traits that complement your own skill set. However, it is arguably the most important of all things to look for in a business partner. Often, people pick partners who are clones of themselves.
Other times, they pick people who are so different from themselves that they are in constant conflict. Find someone who complements your skills, not contrasts with them. If you are not good at a particular aspect of doing business, find a partner who is. Someone with a different skill set can add something to your business that may ignite something new and brings much more success than either of you could have achieved alone. For example, if you are starting a software company and you happen to be a great software engineer, you may not be as good at marketing and other aspects needed to maximize your business's potential.
By partnering with someone who is good at advertising, marketing, and sales, you will be much more poised to promote your services and capture a successful share of the software market. Make sure that the person whom you are considering as a business partner has business goals that are aligned with yours. In other words, you should both want to create the same thing. This goes beyond whether you both want to make money——it means having the same idea of what the company should look like down the road.
Furthermore, you may want the same thing, but have different ideas about how to get it. If the person values fast profits over quality while you value quality and customer service over profits, you may eventually have a tug-of-war over which route to take to achieve your shared business goals. You need to be able to discuss with this person everything related to the business.
Otherwise, issues between the two of you can begin to fester with time, and those that could have been worked out easily will become even more difficult to resolve. Resentment will then set in and a whole downward spiral will ensue just because you wanted to avoid discussing the issue with your business partner. This doesn't mean that you need to find someone who agrees with everything you say, but you need to feel relatively sure that you will be able to:.
A good business partner must be someone whom you can trust. Everyone has their own quirks and individual ways to deal with stress, success, and failure, but if you can inherently trust your business partner, you will have a better chance of succeeding as partners.
Also, when you know that your partner can and will fulfill his or her roles within the partnership , you will be able to focus better on your own. If you don't have faith in your partner's ability to do what they need to do, you will be distracted and will not be as productive as you can be. Would you hire an auto mechanic to run a bank? It is extremely important that your business partner understands the dynamic of the industry that your business is involved in. The value of choosing a partner that understands your industry is that he or she will not need to spend a tremendous amount of time being educated and may already have contacts and ideas that can help your business.
Knowing how to deal with adverse circumstances can be the difference between success and failure, and when a business owner has no experience dealing with the many challenges that a business can face, they are at a huge disadvantage. You may not need a business partner who has experience raising capital , managing a sales force, and creating a marketing plan. In fact, it will be difficult to find someone who has proven above-average results in all areas. If your main concern is consolidating debt and reorganizing bank loans, then you may want a partner who is experienced in business finance.
Similarly, if you intend to pursue government contracts or focus on a particular niche market, you will probably want a partner who has experience doing business in these areas. Business partners may bring with them valuable contacts that can lead to sales. For instance, if you have just come up with a new and innovative business solution, your new partner may bring contacts to company heads who will jump at the idea.
Your new partner can then use their previous relationships with these company leaders to secure new business contracts for your company. Whether you operate as an LLC or general partnership , you need a business partner who is financially stable. Money is the number one reason why most businesses fail.
It is also one of the most common points of contention between business owners. If a person is bad at managing their own personal finances, this is a good indicator that they will be bad at managing your business finances as well.
Moreover, if a person has a tremendous amount of financial difficulties, they will not be able to invest much in terms of time, money, or emotions when helping you grow your business.
Not every potential partner will have the personal resources to invest as much into the company as you have, but they should be willing to invest as much as they can afford. When lenders and venture capitalists see that your partner is also substantially invested in your company, it gives them comfort and makes them more willing to invest their money.
A person with vision is someone who can recognize the value of new ideas or business trends and be involved in actively carrying them forward. They can prioritize ideas and plan a strategy for success. This person will have the ability to hear an idea and instantly tell you the next steps that need to be taken to make it happen. They will also be able to help you come up with new business ideas by instilling a sense of purpose in your team and bringing fresh and original solutions that go beyond the obvious.
In addition, he or she will be able to reframe problems to come up with breakthrough solutions that can move your business in a new direction if needed. A good problem solver is someone who can save your business time and money by pointing out problems and improving on new business processes before they are implemented. Having the ability to challenge the ideas that are under discussion is important, so a good problem solver will be able to play devil's advocate in order to test the soundness of an idea.
This person will also be able to protect your business by paying attention to details that can keep your business organized and running smoothly, and they will be able to achieve business goals through the most direct and efficient means. When selecting and evaluating a business partner, you should use the same approach that you would use if you were looking to hire employees.
However, the difference here is that there is much more at stake when choosing a business partner. That being said, here are three important questions you should consider:.
Small businesses do not need more than a few partners. In fact, according to Paul Graham, the co-founder of Y Combinator , a seed capital firm, two or three business partners works best. That is, two or three business partners tend to work better than four or more partners where there is a greater tendency for businesses to break down and for partnerships to dissolve.
Before you take on a business partner, you need to be ready to share ownership of your company. Whether you base it on the number of man hours they will contribute or the amount of money they will inject into the business, you need to have some idea of how you will share your business with your new partner.
You can split business profits in any way you want, as long as your partner agrees. However, it may be best to first decide upon a formal business structure with your partner before making that decision.
Lastly, you should be ready to get it in writing. Although a written and signed agreement is not a legal requirement for partners, having one can protect the interest of all parties involved for the life of your business and through its dissolution.
We are all too often tempted to go into business with our friends because we love them and enjoy spending time with them. But your friend may not be the right person to be in business with.
To find potential business partners, talk to your accountant, lawyer, or banker; these are people who have a wide network and generally want to see your business succeed, so they are going to recommend good people.
You can also talk to people in trade associations, chambers of commerce, and business incubators to find like-minded people who might make good potential business partners. Choosing a business partner can be the best or the worst decision you make when starting a business.
For some, it starts out wonderfully then goes downhill from there, and for others, it is a match made in heaven from beginning to end. In many ways, having a business partner is a marriage of sorts. You will be spending a lot of time with this person, so you need many of the same things that you would need in a good marriage, such as:. You need to dig very deep to know who this person really is before you decide to enter into a relationship with them.
Sometimes, this means asking some very difficult questions, but if you ask the important questions before you enter into business with this person and be sure you have a partnership agreement in place, you can prevent a lot of the headaches that can plague your partnership and jeopardize the future of your business later on.
Qualities to Look for When Choosing a Business Partner According to recent studies, two-thirds of all businesses fail. A Complementary Skill Set The first place to start when looking for a good partner is to assess your own strengths and weaknesses.
For Example Shared Goals and Values Make sure that the person whom you are considering as a business partner has business goals that are aligned with yours. Easy to Talk To You need to be able to discuss with this person everything related to the business.
This doesn't mean that you need to find someone who agrees with everything you say, but you need to feel relatively sure that you will be able to: discuss any differences you have with the person, agree on a resolution, and come out of it shaking hands and moving forward. Trustworthiness A good business partner must be someone whom you can trust. Knowledge of Your Industry Would you hire an auto mechanic to run a bank?
What They Can Bring to the Business The value of choosing a partner that understands your industry is that he or she will not need to spend a tremendous amount of time being educated and may already have contacts and ideas that can help your business.
Experienced Does this person have the experience to help your business grow? Have they been through the ups and downs of running a business and know what it takes to be successful?
How will they respond to employees who have lost faith in themselves, vendors who are screaming for payment, and clients who are reconsidering the business they give to your company?
Financially Stable Whether you operate as an LLC or general partnership , you need a business partner who is financially stable. Able and Willing to Invest Not every potential partner will have the personal resources to invest as much into the company as you have, but they should be willing to invest as much as they can afford. Vision A person with vision is someone who can recognize the value of new ideas or business trends and be involved in actively carrying them forward.
New Business Ideas They will also be able to help you come up with new business ideas by instilling a sense of purpose in your team and bringing fresh and original solutions that go beyond the obvious. A Good Problem Solver A good problem solver is someone who can save your business time and money by pointing out problems and improving on new business processes before they are implemented.
Other Factors to Consider When Choosing a Business Partner When selecting and evaluating a business partner, you should use the same approach that you would use if you were looking to hire employees. That being said, here are three important questions you should consider: Small businesses do not need more than a few partners. Conclusion Choosing a business partner can be the best or the worst decision you make when starting a business. You will be spending a lot of time with this person, so you need many of the same things that you would need in a good marriage, such as: complementary qualities, open and effective communication, shared values and goals, trust, and financial stability.
10 Things to Look for in a Potential Business Partner
Building a business out of nothing definitely takes the proverbial village, and surrounding yourself with the right people at the right time is crucial for hitting milestones. So how do you know when you are working with the right people—or, more importantly, with the wrong people? But how do you measure and prove a gut feeling? But when it came time to work together, we struggled to reach consensus on small details.
The best founding teams all have different skill sets and values to bring to the table. Sure, you may butt heads with different personalities, but it's more important to have a well-rounded founding team. It allows you to move at the speed at which your business needs to move and ensures that when your partner makes decisions, they're in the best interest of the company. As a founder, it's even more important. You need enough overlap so that the two of you can connect, and you will also be able to accomplish more in a shorter period of time with a complementary partner.
6 Qualities to Look for in Business Partnerships
What makes a good business partner? What should you look for and what should you look out for? Choosing a business partner is like choosing a spouse. You are entrusting this person to your financial investments, your goals, your time, and your future, so it is important to choose a business partner who can stick it out through the long haul, or at the very least, dissolve your partnership reasonably without a messy legal or emotional conflict. Shared Goals and Values Your partner is going to be a major asset in delivering the results you need as a new business owner. As partners, you should have similar goals about your target market, projections, and strategies. Take the time to write out your core values and goals, short-term, medium, and long-term. You should also have matching ideas on how to invest and growth projections. In any case, make sure to discuss the finer points of your business planning to ensure that you are on the same page.
8 Critical Considerations for Choosing the Right Business Partner
Toxic business partnerships can quickly destroy a company. Here are six qualities to look for in potential partners in order to foster a strong working relationship. When vetting partners, think about if it would be rewarding personally and professionally to come together to create a new company. You should be able to see the satisfaction in working with someone who adds value and significance to a shared vision.
With the right partner, you can bring your business to even greater heights. Founding and maintaining a business on your own is a difficult, and occasionally lonely, endeavor. From heightened productivity to emotional support, bringing on a business partner can add tremendous value to your company. Before bringing someone else aboard, reflect on your own personality and strengths.
Top 10 Qualities to Look for in a Business Partner
Not long ago, I saw a situation where an IT business partner was being run ragged by the business making demands that frankly didn't make much sense. The problem was not the business, but reluctance on the part of the business partner to engage properly with the business and help them formulate a realistic approach in planning for the IT element of their project. All too often, business partners are pandering to the business, putting unreasonable demands on their teams and expecting high quality in less time than is needed; complaining when expectations are not met. So, what does it take to be a good business partner while still supporting the business effectively?SEE VIDEO BY TOPIC: Equity Valuation - What percentage should I give my business partner?
When entrepreneurs go into businesses with partners, they end up spending a lot of time with these people. Click To Tweet. This is because you and your business partner should each bring your own unique skills into the business. Reach out to those who had a solid work ethic, and who you know would be willing to put in the extra time and energy to help get your business off the ground. Your partner must not be afraid to hold you accountable and challenge your ideas. Make sure your potential business partner possesses experience in your industry, and knows the ins and outs of how to do well in your space.
7 Simple Steps to Identify an Ideal Partner for Your Business
There comes a time in the entrepreneurship world whereby running a business on your own becomes too difficult due to various reasons. It could be due to expansion demands that call for financial injection, a requirement by law or too much workload in the enterprise that needs someone else in the mix. This means that forming a partnership at times in the business world becomes a necessity. A partnership sounds like a great idea, but not everybody can make a good business partner. Choosing a partner needs a very vivid assessment to avoid any future conflicts in the partnership.
Starting your own business already means countless long hours and late nights, and attempting to carry the weight alone can easily result in burnout. This is especially true if you plan to scale your business quickly; filling every role will be nearly impossible. The solution? Finding a business partner.
10 Qualities of Successful Business Partners
Picking the right business partner is crucial. Check out 10 qualities to look for when searching for a business partner. Ideally, the person you decide to partner with should be just as passionate about your business as you are. You might be able to accomplish a lot more by picking someone who has the skills that you lack over someone you have a lot in common with.
7 Tips for Making a Business Partnership Work
One experience in particular started out pretty good because this person had lots of industry knowledge and connections. We literally could walk into just about any account and the prospect would buy our services. It was great, at least for a while.
Qualities to Look for When Choosing a Business Partner