One of the most important and critical decisions you will have to make when starting a business is who to partner up with.
There are many reasons why
or why not to choose someone, some more obvious than others. This blog is
intended to breakdown what I believe are the five most important factors to
thoroughly analyze and consider prior to moving forward with a decision.
So you have a great idea for
a new business, whether it’s an incremental innovation on an existing product
or business model; or one that is brand new and/or is radically disruptive, chances
are you wont be able to do it on your own, and I would not recommending doing
so. Therefore the question is: who’s the
best man/woman to approach?
Most people's first instinct is to work with someone that they know very well (friend or family member). This may seem logical (initially) assuming you get along with this particular person(s), have known them your entire life, share the same interests, etc. However, there is much, much more to selecting a business partner other than how well you know or "think" you know them, as things/people change when other variables enter the "frey" (e.g. money, egos, growth path, vision, exit strategy, personal goals, equity share, personal life, etc.). As a matter of fact, choosing a business partner is kind of like dating (per say).
Personality:
Running a start-up is a roller coaster, you will experience many highs and lows, ups and downs, so you'll need someone that can roll with it and not let it bother them too much. In fact, it is good to have someone that can make light of the situation (as long as it's not too serious). Furthermore, their personality should complement yours, just like in a relationship you need balance. If you're personality is super outgoing and forward, you'd want someone that is more laid-back and reserved. Everyone that has been involved in a start-up will tell you there are always issues and when there's not, there's one right around the corner; so you want to be able to rationally discuss the strategy on how to fix the issue with someone, and keeping the atmosphere light is extremely helpful.
Reliable:
This one is very important, particularly to me as it's a pet-peeve of mine. It really irritates me when I am supposed to meet with a client or business partner and they are always late - time is precious to all of us as life moves very fast, especially in today's world. The last thing you would want is to start a business and partner with someone who can not manage their own time. To me this is a HUGE red flag. As I stated above, when running start-ups issues are always showing face and when they're not, one is right around the corner. Imagine how frustrating this would be if you had to handle the majority of them on your own, or had to wait to hear from your partner who is nowhere to be found. This can sour a relationship/partnership quickly, not to mention the waste of time and capital - I've seen it first-hand.
Knowledge/Intelligence:
What I mean by this is, you want to partner with someone that either/or has knowledge of the industry and current landscape you are planning on entering and competing in; and/or has knowledge of some other aspect of the business which you are not an expert in or have little knowledge of (e.g. marketing, operations, sales, strategy, etc.). Again, forming a business partnership is usually a long-term commitment and you want both partners to provide valuable insights consistently, and coming from a different perspective is always helpful. Intelligence simply means that as described by its definition - the ability to learn and understand things; nothing is worse and more frustrating than dealing with incompetence, particularly in a business partner let alone an employee.
Resourcefulness:
This one is also extremely important, especially when launching a start-up, and as technology continues to take over all businesses, large and small. When choosing your business partner you want someone who has a large diverse network and understands how to maximize its potential. The majority of start-ups are boot-strapped and have minimal expendable capital to allocate to other resources other than immediate needs for day-to-day operations; thus the importance of having access to a diverse network. Just as an example, you will need legal contracts drawn up; well these can be quite costly if you go in cold and do not know someone or someone who knows someone. A friend of a friend may refer you to an attorney friend of his/hers and they may offer a discount or even pro-bono, who knows. Further, there are countless reasons to contact people outside of your immediate circle, and with social media a diverse network is now more accessible than ever - easier to connect to professionals in all walks of life.
Vision:
When I say vision, I mean the vision of the company; does their vision coincide with your vision? Where do you and your business partner envision the company being in a year or two or five? What is your goal? To build and sell quickly? Grow organically and commit to a long-term plan? License out the technology or product? Bring in outside investors? This is something that should be discussed at length prior to committing to an agreement with a potential partner. If your vision conflicts with your potential business partner's, the relationship will go south very fast, and more issues will arise and compound - turning a potentially successful business into an unsuccessful one. Furthermore, it is good to discuss the "what ifs". What if this happens, what do we do? What if that happens? etc.
Conclusion:
In the end, you want to work with someone that is not necessarily your best friend, but someone that understands what it takes to make a business successful. You want someone you can depend on, bounce ideas off of, provides valuable insights, can laugh and keep things light; someone who is flexible and not hard-headed, is highly competent and can maximize their resources effectively and in a timely manner. For the record, I left out an obvious one - TRUST - on purpose, as it is applicable to everything you do in life; if you don't trust someone, you should keep them at a distance, and definitely NOT do business with them.
This is my first independent blog so I know it's not perfect, but I enjoyed it and there will be more to come, along with some posts from other friends which I trust. HA!
Feel free to leave comments as I'm very interested in hearing what you have to say.
PS - If you are in need of any Business and Marketing consultation for your small to mid-sized business/start-up feel free to shoot me an email at: modernbizstrategy@gmail.com.
~Peace
ModernManTellsAll
Tweet
Personality:
Running a start-up is a roller coaster, you will experience many highs and lows, ups and downs, so you'll need someone that can roll with it and not let it bother them too much. In fact, it is good to have someone that can make light of the situation (as long as it's not too serious). Furthermore, their personality should complement yours, just like in a relationship you need balance. If you're personality is super outgoing and forward, you'd want someone that is more laid-back and reserved. Everyone that has been involved in a start-up will tell you there are always issues and when there's not, there's one right around the corner; so you want to be able to rationally discuss the strategy on how to fix the issue with someone, and keeping the atmosphere light is extremely helpful.
Reliable:
Knowledge/Intelligence:
What I mean by this is, you want to partner with someone that either/or has knowledge of the industry and current landscape you are planning on entering and competing in; and/or has knowledge of some other aspect of the business which you are not an expert in or have little knowledge of (e.g. marketing, operations, sales, strategy, etc.). Again, forming a business partnership is usually a long-term commitment and you want both partners to provide valuable insights consistently, and coming from a different perspective is always helpful. Intelligence simply means that as described by its definition - the ability to learn and understand things; nothing is worse and more frustrating than dealing with incompetence, particularly in a business partner let alone an employee.
Resourcefulness:
This one is also extremely important, especially when launching a start-up, and as technology continues to take over all businesses, large and small. When choosing your business partner you want someone who has a large diverse network and understands how to maximize its potential. The majority of start-ups are boot-strapped and have minimal expendable capital to allocate to other resources other than immediate needs for day-to-day operations; thus the importance of having access to a diverse network. Just as an example, you will need legal contracts drawn up; well these can be quite costly if you go in cold and do not know someone or someone who knows someone. A friend of a friend may refer you to an attorney friend of his/hers and they may offer a discount or even pro-bono, who knows. Further, there are countless reasons to contact people outside of your immediate circle, and with social media a diverse network is now more accessible than ever - easier to connect to professionals in all walks of life.
Vision:
When I say vision, I mean the vision of the company; does their vision coincide with your vision? Where do you and your business partner envision the company being in a year or two or five? What is your goal? To build and sell quickly? Grow organically and commit to a long-term plan? License out the technology or product? Bring in outside investors? This is something that should be discussed at length prior to committing to an agreement with a potential partner. If your vision conflicts with your potential business partner's, the relationship will go south very fast, and more issues will arise and compound - turning a potentially successful business into an unsuccessful one. Furthermore, it is good to discuss the "what ifs". What if this happens, what do we do? What if that happens? etc.
Conclusion:
In the end, you want to work with someone that is not necessarily your best friend, but someone that understands what it takes to make a business successful. You want someone you can depend on, bounce ideas off of, provides valuable insights, can laugh and keep things light; someone who is flexible and not hard-headed, is highly competent and can maximize their resources effectively and in a timely manner. For the record, I left out an obvious one - TRUST - on purpose, as it is applicable to everything you do in life; if you don't trust someone, you should keep them at a distance, and definitely NOT do business with them.
This is my first independent blog so I know it's not perfect, but I enjoyed it and there will be more to come, along with some posts from other friends which I trust. HA!
Feel free to leave comments as I'm very interested in hearing what you have to say.
PS - If you are in need of any Business and Marketing consultation for your small to mid-sized business/start-up feel free to shoot me an email at: modernbizstrategy@gmail.com.
~Peace
ModernManTellsAll
No comments:
Post a Comment