Get All Access for $5/mo

7 Keys to Healthy Co-founder Partnerships These concepts are relevant for entrepreneurs who want to strengthen their collaboration.

By Michael Episcope Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

Shutterstock

The saying goes something like this -- co-leadership is no leadership. I don't buy it.

Since 2007, David Scherer and I have been co-CEOs of Origin Investments, a Chicago-based real estate investment firm with nearly $500 million in assets under management. And we were friends before that. I'm pretty sure that's another rule we ignored.

So how has our partnership survived? David's helped me come up with seven reasons our relationship has not only endured but flourished. More appreciably, these concepts are relevant for other entrepreneurs who want or need to strengthen or sustain their collaboration.

1. Make equally shared financial contributions.

If one partner invests in a deal and the other doesn't, and it goes south, the partners are not in the same situation. To keep our business interests aligned, we assume equal financial risk. We put an equal amount of money into every acquisition and the company.

2. Shoulder equal workloads.

Equal contributions must extend to time spent on the job. Having one guy working part-time and the other working 80 hours a week will only lead to bitterness and resentment. I've witnessed different work ethics tear partnerships apart. Plus, it's impossible to be equally respected as leaders if you don't both lead by example and hard work.

Related: Everything You Need to Know About Business Partnerships

3. Have shared transparency and alignment values.

Partners must be transparent. Keeping secrets from each other, whether personal or professional, will destroy a partnership. And we extend the same standard to our business by investing substantially alongside our investors. So if one of us thinks funding 2 percent of a deal is substantial, we have different values. To date, we've invested or committed $42 million to the firm's real estate deals.

4. Respect defined roles and responsibilities.

While we jointly decide whether to purchase an office or apartment building, we're careful not to step on each other's turf. "We don't manage each other's people," my partner Dave says. "Otherwise, it's not only a stress on the partnership, it's a stress on a team. Each partner has to respect the other's role and not second-guess his decisions." Leading our teams is an individual responsibility we do not violate.

5. Actively work together.

Though we split responsibilities and run different areas of the business, we do overlap on critical decisions such as investments and direction. This creates a parallel management model that helps us know and respect each other's judgment and skills.

Related: What to Consider Before Teaming Up With a Partner

6. Agree on vision and responsibilities.

Some partners don't agree on vision, or even understand what their vision is and where they want to take the company long-term. If I say "I really want to invest heavily in digital to target investors," and if my partner Dave says "I want to hire an investment bank to work with pensions and endowments," that is an unshared vision. We should be able to speak as one on the firm's investment focus, business plan and discipline.

7. Foster communication and don't keep score.

Partners must develop ways of speaking with each other that won't build resentment. We don't always get along, but we have found ways to talk about things and move past them. Dave says "resentment is not like wine. It doesn't get better with age." We don't let conflicts fester, and we communicate as much as possible face-to-face and via phone. Also, we each reserve time to communicate and treat those meetings as if we were meeting with a client.

Related: 13 Tips to Create the Perfect Partnership

We each arrive on time and are prepared. Right now, our partnership is approaching its 10th anniversary, and there has never been a time when we've had a stalemate. I like being able to knock ideas off a partner. It keeps me accountable. But best of all, I like the freedom to focus on my own projects and passions -- and know that my partner and I have each other's best interests, and those of our company, in mind.

Michael Episcope

Cofounder

Michael Episcope cofounded Origin Capital in 2007 with David Scherer to create access to real estate investments and management expertise that were previously only available to institutions. His investment philosophy is rooted in risk management and value creation, and he has purchased and executed more than $650 million of commercial real estate and debt collateralized by commercial real estate. Michael is the former President of the DePaul Real Estate Alumni Alliance, an official mentor to DePaul graduate students and a sustaining sponsor of the DePaul Real Estate Center.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Franchise

How to Know If a Local Business Has Franchise Potential, From a Guy Who Built One Into 80 Locations

Wade Brannon had already built and sold one franchise when a kid's hair salon in his area caught his interest.

Starting a Business

How to Find the Right Programmers: A Brief Guideline for Startup Founders

For startup founders under a plethora of challenges like timing, investors and changing market demand, it is extremely hard to hire programmers who can deliver.

Business News

Amazon Is Reportedly Tracking 'Coffee Badging' Workers and Their Real In-Office Hours

Leaked Slack messages showed employees had a minimum number of hours they needed to be in the office for the time to count as an in-office day.

Leadership

I Was Reappointed as CEO — Here Are 2 Ways a Fresh Perspective Helped Me Unlock New Growth For My Company

When stepping into a new CEO role, striking the right balance between listening and action is the key to moving the business forward

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.