Taking on a business partner can really help your business grow and succeed. Taking on the wrong business partner will send you into closure when you can’t work together. Avoid these pitfalls when looking for a business partner.
Forgoing a written agreement
Your new business partner might be your best friend from high school who you’ve known for decades. What could possibly go wrong? Even if you’re on the same page, put everything in writing. Work with an attorney to cover when the partnership begins, how to end the arrangement, what happens if one partner wants to leave or dies, and what capital each person is bringing to the table.
Making quick decisions
Making long-term decisions for the business will take time. Each person needs time to think and work out the outcomes. Major decisions may even need to be in writing once the agreement is made. Both partners will be responsible and even liable for each decision, whether good or bad. Spend time talking to each other before jumping into the deep end.
Not getting professional assistance
As business partners, you’ll share profits and losses together. When everything is going well, the partnership will probably look great. When there are losses, you’ll be battling stress and conflict over every decision. Having professional legal and financial help, especially in the early days of the business, will help you set up an arrangement that can protect your personal assets and help you track what you should be doing. A lawyer and tax consultant can really be beneficial when you’re getting started, even if you don’t have a business partner.
One surefire way to avoid taking on the wrong business partner is to find financing without giving up equity. Talk to the financial specialists at Fast Commercial Money to find funding that fits into your goals.