business partnerships

How To Make Business Partnerships Work

Business partnerships can be highly effective. The right people come together, they share a vision and have the same goals and they manage to work in sync as they grow a company. Then of course there are business partners who may not gel all that well when it comes right down to it. And ultimately there may be a rift—of a significant degree, which then causes the company to have to shut its doors, effectively splintering that particular partnership. In this article, we look at advice from business partnerships who’ve managed to succeed and have made their collaboration a successful endeavor.

Have a Prior History of Business Partnerships

You don’t necessarily have to have been business partners per se, but it is key that you have worked with one another before in some form of a collaborative effort. This is because you want to have a sense of their work style and approach first. You need to get a sense of whether or not your styles blend well. You don’t have to have the same philosophy of business and/or work, but they should without question be compatible. If you haven’t really worked together before but still think that a certain person would make an ideal business partner, then you might pick a small project and test the waters.

Have a Shared Vision

Why even partner with someone to begin with if you are working at cross purposes? It makes no sense. You need to establish before launching an endeavor what the vision and purposes of that venture are. Ensure that you discuss in-depth both short and long-term goals for the business. Starting with a common idea and/or concept is terrific; however, if you cannot pull together a cohesive vision around this idea—at least one that you both agree upon—it really will never get off the ground in any sort of effective manner.

Bring the Money Thing Up Early

Talking about money is one of the hardest conversations that business partners can have. But putting it off or skirting around the issue is only going to make it even more difficult to have any such conversation down the road. Whether you are going to have a 50/50 approach or you have something else in mind, you need to put your cards on the table when it comes to money first otherwise this could create tension and turmoil within the business.

Establish Your Roles

Generally, the best business partnerships are the ones in which one person steps up as the leader while the other tends to play a behind-the-scenes role in terms of execution especially. Both roles are necessary, but determining who is the leader is crucial to a smooth partnership moving forward. Also, as far as the decision-making process, you want to nail down how exactly that is going to play out between you. In other words, what decisions will need to be agreed upon by both? When is one business partner to consult the other? Hammering out details such as these will only get you closer to success in the end.

business partnerships

Have Compatible Skills

Certainly, you can both possess the same skillset, but the most successful business partnerships tend to be those that have compatible skills. For instance, one of you may be very good at programming while the other has a strong sales background. Both are required for your venture and given that each partner has a different skill vital to the company, you won’t need to seek out as much outside help. Not to say that if you were both tech people the business would fail, but it is good to have a diverse array of compatible skills and talents at the top.

Make Sure Your Styles Gel

Going back to the question of whether or not you’ve worked together prior, ensuring that your styles effectively blend in terms of leadership and management is going to be critical to a productive partnership. There can be differences in your style—that is fine, and these differences may even work to your advantage. For example, one of you may be more of a hands-off manager while the other likes to run a highly organized ship. As long as these two approaches can come together positively, you might potentially be able to achieve some tremendous results.

Decide On Hiring Procedures

Especially in the early phases of a company, you are going to need to fill some key positions. The decision on who to hire as well as how to go about hiring and subsequently filling positions is going to be something that business partners will have to come together on. You both have to agree on how the interview process works, before that even, how the review of applicants will take place. Ideally, both partners will be involved in the hiring. Interviews should also be conducted by both in most cases. Every step of establishing your company needs to involve the two of you being on the same page.

Have an Exit Strategy

Granted, when starting your company you don’t necessarily want to think about ending it. However, the fact is that for a variety of different reasons, companies do come to an end—be it they simply can’t make it or they are bought out by larger corporations. This is why you do want to talk about “what happens when…” Especially if you start as friends, the ending of a company can place great strain on a friendship; the more you discuss upfront, the more prepared you will be for what happens when the company no longer exists.

First Union Lending has been working with small businesses for years. We want to see our clients thrive and succeed. With fast and flexible loan programs, we get the funding when they need it—not weeks or months from now. Call today!

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Are you ready for greatness? First Union Lending is here to help you achieve your financial goals.

Let’s do this together!

Are you ready for greatness? First Union Lending is here to help you achieve your financial goals.

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