The saying goes you should never mix business with pleasure but if you’re considering starting a business you may appreciate having a friend in your corner. Perhaps you’ve come up with the business idea together, have been work colleagues before or simply fancy embarking on a new challenge with your best pal. In this post, we’ll provide some food for thought so you can make the best business decision for you both.
How well do you really know each other?
You may have known them since primary school or your uni days but do you truly know what they’re like when they’re at work? Are they prepared for the hard graft involved in running a business? Will they be looking for the easy life and rarely get their hands dirty?
Are they dedicated?
Starting any business takes a lot of time and effort, often with little financial reward in the beginning. You’ll be working long hours and you need to know that your friend is equally as committed and dedicated as you. For instance, you won’t want them talking half days or time off whenever they fancy, leaving you to carry the business.
Will it be 50/50?
How much money are you each putting in? What salary will you be taking? You need to decide whether you both will own the business equally or whether one of you will have the lion’s share. You’ll need to visit a solicitor and have things put down in writing so that everyone is clear from the offset how things stand. Otherwise, should there be a disagreement in the future, there could be major issues.
Who will be responsible for what?
It can be helpful to divvy up your business so that you’re responsible for different areas, be it sales and marketing, production and delivery. If for instance, you’re running a home help service, perhaps one of you will be customer facing and deal with day-to-day issues and the other will deal with HR, payroll and invoicing etc. In doing this, you should be able to ensure that everything gets done on time and one person isn’t doing the majority of the work. It can also help things run more smoothly as you’re not over complicating things and stepping on each other’s toes.
Know your strengths, and your friend’s
When deciding who does what in your business, as well as ensuring you have an equal spread of responsibilities and workload (if you’re in a 50/50 partnership), make sure you’re also using each other’s skills, expertise and qualities to the max. You may fancy doing a bit of digital marketing for the business, but if your friend and business partner has the expertise they would be better suited. Keep in mind that these decisions should be based on what’s best for the business and business partnership, not just what you want to do.
Communication, accountability and transparency
Daily or twice weekly catch ups should be done in a professional manner, with minutes taken for your records. Your business partner may be your friend but when you’re at work you should put your business hats on. The success of your business may depend on it.
Make sure you have systems in place so that both partners are kept fully informed of all activities you undertake as a business. You may be responsible for the accounts, but your partner will need to access this information too. This also ensures that if one of you is ill or unavailable for some reason, the other can pick up where they left off.
Consider what would happen if you fell out
There will no doubt be the odd disagreements but if one day you decided that you couldn’t work together, perhaps one of you decided to leave the business, this could end your friendship as well as the business partnership. Would this be something you’re willing to risk?
Your business partner may decide to go it alone and take all the knowledge and contacts you’ve built up together. This can be a crushing blow and may be hard to bounce back from. Alternatively, they might want you to sell the business on to someone else, which could cause friction. Running a business with someone else is never stress free.
By addressing the issues and questions raised above you can enter a business partnership with your eyes wide open. It’s about managing everyone’s expectations on every level; from the financial commitment you make, to your working hours, the business strategy and plan, to what happens in certain situations.
It’s really important to document your strategy and plans – business plans, growth strategies, marketing, recruitment plans etc. Also have a plan for different eventualities – what if one of you wants out early, what if you want to introduce a new business partner, what if you fall out, what if health or external factors effect your business partnership?
Bask in the glory together
It is possible to have a wonderful working relationship with a friend and create an amazing business that makes you both happy for many years to come. The key is communication and understanding. Give and take. In some ways it’s a bit like a marriage.
You need to also invest in that relationship so make sure you’re prepared to put in what you take out.
Are you in business with a friend? I would love to hear from anyone who has experience of this. Share your story and any advice or tips using the comments below.