Startup Tip 52: Why you need to find a business partner

Like life, business is easier (and more fun) when you are doing it with someone else. [Tweet this] Successful businesses are a team effort, not a lone ranger mission. [Tweet this] If you haven’t done so already, go and find a business partner. Here’s why:

Make yourself take action

Having two of you will force you both to take action and provide accountability for getting things done. Personally, I have had an idea I had been sitting on for at least a year. I knew I should take action on it and had a gut feel that it would be commercially viable but didn’t do a lot until I teamed up with a business partner in the last month. We have created a lot more momentum together in one month than I had created by myself in the previous year.

Fill your skills gap & be good at everything

If you are like 90% of ideas people, you have plenty of ideas but need to be forced to take action. If you are great at execution, a doer, you may be itching to do something but not have a focused idea to work on. Find a business partner who has complementary skills to yours and you fill in the skills gap that each of you has alone. There are lots of examples of these sorts of successful partnerships. Paul Allen & Bill Gates at Microsoft and Steve Jobs and Steve Wozniak at Apple are two of the most well-known ones.

Create synergy

Two brains are better than one. You will have better ideas, create better products and execute better with two of you working on the business. You will create a bigger pie than is possible by yourself.

Expand your networks

Putting your networks together will give you far more reach and contacts than you can access alone.

It’s more fun

It’s more enjoyable and rewarding working with others. And we need to make it as enjoyable as we can to boost our persistence in the startup game.

But, I don’t want to find a business partner, I hear you say…

Two of the most common objections to having a business partner are:

  • What if we don’t get on and it all ends in tears?
  • I don’t want to give any equity away.

If you really don’t want to take on a partner, then you shouldn’t. But realise that it will limit the growth your business can achieve. If you are open to thinking about it, I would like to offer a few pointers:

Make sure you can work together before you formalise your business relationship. When you first have an idea is not the time to offer 50% of the company to someone else.

This is the approach I’m taking: Start working together to evaluate the idea but don’t create a legal shareholder’s agreement or other structure until we know we have value in the business and we are clear on what each person is bringing to the table. Then make sure we create an agreement which is fair to all parties and which covers all eventualities we can think of. Do this in a culture of respect and trust and also with our eyes open.

If you can’t trust the person you are working with to go through this process with you, then you are working with the wrong partner.

As to giving up equity, it’s better to have partial share of a real business that is growing and delivering value to customers than 100% of an idea [Tweet this] – which is where your business may stay without someone to help you.

There are lots of horror stories about what can happen when people have the wrong business partner. However, all startups that have made it big, have a team – you can’t get funding without one and you can’t grow beyond a certain size as a solo effort. So have a think about whether you need to find a business partner to move your idea forward.

Action:

  • What are you lacking to move your business forward? Skills, Ideas? Contacts?
  • Would having a partner fill some of those gaps? What skills and qualities would they need to have to be complementary to you?
  • Who do you know who might be your perfect match in business?
  • What would your strategy be for getting her or him on board? How will you do your due diligence to make sure it is a positive relationship for both of you?

Further Reading:

Beginner’s Guide to Finding the Right Business Partner by Neil Patel. Great advice on how to move through the process and find a business partner.

Join the conversation:

If you agree, disagree or have something to add please share with us in the comments. That way we all learn – and I know that there are real people out there reading this! :-)

And I would love you to join me on Twitter.

 Image used courtesy of Niko Si under Creative Commons license.

 

Comments

  1. Hi Susan. Good stuff. Agree with most of these points, and feeling excited that I’ve found a business partner. We spent some time co-working before I floated the idea. Now we’re moving ahead and doing due diligence on everything up front, but early signs are good!

    All the best
    Matt

  2. Great stuff Susan.
    Makes me think through this topic more clearly than I have before.
    Seems that I need to get much clearer on why I have not taken on a business partner, and then figure out what to do with it.

    Thanks for the great post :)

  3. I think partnerships are great. That’s one reason I helped start a company so people can find their new business partner online. Check out http://www.EquityPartnerMatch.com to see if you can find your new Equity Partner Match. Thanks.

  4. Well written Susan. I’ve experienced the same synergies with my business partners. It comes down to finding the right person(s) to work with. One caution you did put forward though is really important. What if your partnership goes sideways at some point? Writing a shotgun clause into the partnership agreement will protect both parties. In a nutshell, one party makes the second party an offer to buy them out. The second party has a set time to accept or match the offer. If the offer’s matched the second party can buy out the first party. It insures a reasonable offer is made – and the mechanism is binding. I wouldn’t consider a partner without one.

    • A shotgun clause is a must have Michael. Thanks for pointing that out. So many ventures run into trouble because the partners haven’t planned a way to deal with different scenarios.

  5. Good article! Partnerships can be great when you have the right partner. I would recommend starting with a good partnership agreement before you start. See the basics of a good partnership agreement at http://www.PartnersInDemand.com/toolbox . I found this list of some of the most successful partnerships:
    •Larry Page & Sergey Brin
    •Bill Hewlett & David Packard
    •Bill Gates & Paul Allen
    •Steve Jobs & Steve Wozniak
    •Ben Cohen & Jerry Greenfield
    •Warren Buffet & Charlie Munger
    •Coco Chanel & Pierre Wertheimer

  6. I can say I’am a expert in ICT to support and launch rigcareer.com , but lacking financial support. I have all resources expect right investment partner with experienc ein oil and gas industry. Any one interested to join as partner for this project , Please drop me a email @ partner@rigcareer.com

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