Starting a business is one of the most empowering moves you can make in both your career and your life. In addition to creating a means of getting your goods or services to the world, you are establishing a place of employment for yourself and others.
Such a huge undertaking is often very personal, and many entrepreneurs tend to shoulder the bulk of the decisions and responsibilities themselves. Still, there may come a point where bringing in a partner could make sense, particularly if he or she has skills and experience that complement yours, and can assist with achieving the growth and health of your business.
Here are some pros and cons to consider if you’re thinking of bringing a partner into your business.
Greater depth and expertise
As a business owner, you are accustomed to wearing many hats, and you know how to get things done efficiently and effectively. Still, there are limits to every person, and so you are bound to have areas in some of the disciplines required to run a business that do not play to your strengths. Having a partner who complements you, offering added expertise beyond what you possess and a desire to handle tasks that you would prefer to hand off, can be an enormous asset.
Another perspective on business decisions
Should you increase your product offerings? Or open a new location to meet demand for your current products? Should you increase the marketing budget? Or use the money to hire more help? These are just a few of the many decisions a business owner must make in the normal course of a year. Shouldering the burden for every choice can be extremely difficult, not to mention potentially limiting. There may be a side to things that you have never considered, or a means of researching options you never saw before. Having a like-minded and savvy partner who can make valuable contributions to the direction of the business gives you a massive leg-up on the competition, and sets your company up for success.
Having a cohort and support system
Running a business can be a lonely endeavor. The weight of the world, or at least the business, rests on your shoulders, and over time that weight can take a toll on your health, wellness, and productivity unless you manage it well. The presence of a like-minded partner gives you someone to share the weight with, as well as a source of support when hard choices, such as staff reductions, have to be made. A business partner is in it with you, and has a large, if not equal, stake in the success of the business. As such, you’ll have someone who cares about your company with the same fervor that you do.
Giving up ownership/power
Any new employee in a small business is a substantial change in personnel and operations. Bringing in a partner is an addition at the highest level, meaning that it will trickle down to every other employee in the business. It is critical, before entering into the partnership, that you and the potential partner lay out every aspect of the business and define who will take on ownership and responsibility for each facet of the business. As far as financials, you will have to assess how much this partner is worth to you. Are you willing to give up equity in the business? Will profits be split equally? Or will you focus on an “eat what you kill” model, with each partner taking home the profits that he or she earns? How will disputes be handled?
Differing views on the fundamentals
If you started the business, it was likely a very personal decision that required sacrifice. You took risks, expanded yourself beyond your comfort zone, and created something from the ground up. If you bring in a partner, will he or she feel the same way about the business that you do? Will its success be as important to him/her as it is to you? These can be the toughest questions to address with someone, but they can also be the most critical.
More complex decision-making
While having just one person at the top can be exhausting and potentially limiting, it is also highly efficient. If you are a team of two or more, you will need to create a system of discussing major business decisions and coming to an agreement on how to move forward. Otherwise your business may find itself logjammed in discussions and disagreements that weigh down operations and hinder the company’s survival.
Great businesses have been built by partnerships. Others have been eroded by them. Having a business partner can be an incredible asset to your company, your career, and your daily life. Just be sure to enter into any partnership with care and caution, doing your research and knowing the full picture of what you are entering into. Otherwise, you may regret your decision down the line.