Finding the Right Business Partner Header

Finding the Right Business Partner

  11 months ago (Wed, Jul 26, 2023 at 10:55 AM)

One thing that becomes clear to many potential business founders, while conducting organizational feasibility analysis, is that they need one or more partners to help launch their business. You might be a Web developer who has a great idea for a Web 2.0 cooking site, for example, but have no experience in marketing or sales. In this instance, you may need to find a partner with marketing and sales experience to successfully launch and run the firm. There are five key criteria to look for in a business partner. You want to get this right because picking the wrong partner or partners can lead to a lot of heartaches and business challenges.

1. Know the skills and experiences you need. Make an honest assessment of the skills and experience you bring to the business and the gaps that remain. Pick someone who fills the gaps. For example, if you’re an experienced Web designer you probably don’t want to partner with another experienced Web designer. Pick someone who brings other competencies that you need to the venture, like marketing or finance.

2. Make sure your personalities and work habits are compatible. While you don’t need someone who is just like yourself, you do need to be comfortable with the person you’ll be in business with. For example, if you’d rather work 16 hours a day if that is what it takes to finish a project on time, and your partner would rather quit after 8 hours a day and try to renegotiate the due date for the project, that difference in work styles will invariably cause conflict. Similarly, if you like to wear a coat and tie when meeting with clients and your partner thinks wearing blue jeans is fine, obvious disagreements could arise.

3. Make sure you and your partner have common goals and aspirations. Be sure that you and your partner are shooting for the same target. For example, if your goal is to build a billion-dollar company but your partner would be perfectly satisfied growing the company to $10 million in sales and then selling out, obvious problems could ensue.

4. Look in the right places. If you don’t have someone already in mind, it’s important to know where to look for a potential partner. Generic networking events, like Chamber of Commerce mixers, are usually ineffective for finding a business partner. Instead, if you’re looking for an engineer, contact engineering trade associations for leads or attend engineering trade fairs. Social networking sites for professionals, like LinkedIn, can be an effective way to make contacts. There are also Web sites like PartnerUp, Founders Space, and that help people identify business partners.

5. Hire a lawyer. When you have identified a potential partner and you’re confident that the criteria shown previously have been satisfied, you should hire a lawyer to sit down with the two (or more) of you to help hammer out the details. You should decide what each partner will contribute to the business, how the equity in the business will be split, what form of business ownership to select, what each partner’s role in the company will be, and so forth. It’s important to hire someone who’s not loyal to any specific partner (even if it’s you). Hire someone who is impartial and everyone feels good about. 

Reference: Entrepreneurship   


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