5 Questions to Decide If You Need a Business Partner You might actually need a loan or an attorney, not somebody to split your company with.
By Phil La Duke Edited by Frances Dodds
Opinions expressed by Entrepreneur contributors are their own.
When you write as much as I do you get barraged with people who want to partner with you. Most are hucksters who see that you have a capability that they lack and see the sales potential for it, although they don't have any customers per se. Others think I have money that I want to invest in a hair-brained scheme with someone I don't know. These things happen so often that I am reminded of advice given to me many times over the years: don't have a business partner.
But, I have had business partners and it has worked out well for me, which got me thinking (yes, yes, I know always a dangerous space to be in) about just what it takes to make a business partnership work. So, out of that chemical soup that is my mind comes the following tips on deciding whether or not you should have a business partner (I could write tips on whether or not to have a romantic partner but given my track record in that regard even I wouldn't follow that advice).
Related: 5 Things to Do Before Saying 'I Do' to a Business Partner
1. Does my potential business partner have skills I lack?
When I co-founded Rockford Greene with Pat Sullivan, I realized that it was a great coupling. Pat and I had been friends since high school and he has always been good with money the way some people are good with music or art. I am good at training, consulting and riling people up. My ability to enrage strangers with my writing makes a lot of people nervous, but Pat would always say, "look at how you are reaching these people at an emotional level. I picture them frothing at the mouth with rage and so angry they can barely type." Pat said for everyone I mad made I probably made six fans. He was right.
2. Does my potential business partner share my vision for the company?
Prior to founding Rockford Greene International I had several partnerships that didn't work out, largely because my partner and I had very different views of how the company should be structured. I wanted to build something, while he wanted to take the money and run. I wanted to build a traditional workplace that had employees and office parties, or at least a group of people united by values: he, on the other hand, wanted it more like a law firm where people would bring in a stable of clients and we would each be autonomous. When we had milked the proverbial cow long enough we would sell out to the new crop of partners. Our visions weren't compatible (not to mention his erratic behavior and hot temper), so I walked away.
Related: Everything You Need to Know About Business Partnerships
3. Do I need funding?
A lot of entrepreneurs need funding to get started or to take the company to the next level. You may find a partner who brings that to the table, but before rushing into a partnership consider finding investors rather than a full partner.
4. Is my company likely to generate enough revenue to support a partner?
You may need a partner but if your revenue is such that you can't afford to pay yourself and your partner than your business will fail.
5. Does your partner have skills that you will only need for a short time?
If you need someone to set up your cash-flow, write a contract or write a proposal, then you probably don't need a partner; you need a consultant, lawyer or freelance writer.
