Do's and Don't's of Finding a Business Partner
Not having the right team is the third biggest reason for the failure of business right after no demonstrated market need and lack of finance. Ensure you partner with the best by diligently following this list of Do's and Don't's.
First off, the Do’s
Discuss your vision for the company time commitment, financial constraints, equity for business partners, company’s commitment to political/social causes, aggressive or conservative tax returns strategy, and salaries at the company you two are about to be partners at.
Look for Complementary Skills
Business partners should have skills that are complementary to one another. For example, if one is a coder, the other must be a marketing or finance specialist.
Have An Exit Strategy
Have an exit strategy written into your partnership deed. What happens if one of the business partner underperforms in the future? Getting rid of a partner can get messy if it is not written and signed off in the business partnership deed.
Conduct Cue Diligence
A simple google search can tell you if there's something fishy about the person you are about to start a partnership with. Try these searches:
"Person’s name” + lawsuit
“Person’s name” + arrested
“Person’s name” + accused
“Person’s name” + judgment
“Person’s name” + settlement
Research About The Person on Spokeo.com
Spokeo is a tech start-up that leverages data to give you all available public information on a person. It will give you access to their public social media profiles and also public police records. If you are starting a business with a completely new person, you wouldn't want a child sex offender on a team.
Explain Your Vision
Sharing your vision for the company is paramount to avoid a fall out later. Do you want to build a billion-dollar unicorn or do you want to sell your company for a profit to a giant 3-4 years down the line?
Get Your Employees Involved
Get your employees involved when you are hiring a new partner on board. If they are going to have a new boss, they have a right to know him. People sometimes treat people in authority well but, terribly mistreat the employees.
Conduct a Trial Run
Work on a No strings attached basis before you commit and sign that partnership deed. This will help you decipher if you two can work for a long time together.
Next, the Don’ts
Settle for Unequal Commitment
A partnership is all about equal commitment. If your partner is not willing to commit to equal effort then the partnership is not worth it.
Agree to Handshake Deals
Sign the partnership deal before you make any commitments. Handshake deals don't uphold in the court of law.
If you have an amazing friend that has a complementary skill set and is as passionate about the ideas as you are, go ahead and start a business with them. The old-age adage about not mixing your professional and personal lives is redundant.
Have a Partner Without Asking Why
Do you really this partner aboard your team? If the answer is yes, ask why? The question "Why" will help clarify your reasons for having the person on board.