Few things are more valuable to a business than a productive partnership, but nothing is more destructive than partners who don’t get along.
Apple would never have gotten off the ground without the complementary talents and personalities of Steve Wozniak and Steve Jobs, and many other businesses profit from the diverse abilities that two partners can bring. But partners who are barely on speaking terms? That company is nearing disaster.
How can you give your partnership the best possible chance to succeed, while protecting your interests and your business if things go wrong? Below are several tips to get you started – but please contact us to discuss your specific situation.
One of the fundamental things to have in place from the very beginning is a proper partnership agreement. Creating a partnership agreement, with the assistance of a business lawyer, will force you to consider a number of salient issues. You’ll discuss ownership share, day-to-day responsibilities, the procedure for one partner to leave the business, and more. It’s important to have these key decisions written down in a legally binding document.
Make sure you and your partner’s expectations for the business are in sync. You may think you’ve been talking about apples while your partner thinks you’ve been talking about oranges. Writing everything down is one good way of ensuring you’re both on the same page. Common misunderstandings include how much time each partner will spend in the business, how soon you’ll hire employees, if and when you’ll sell the business, and so forth. Assumptions are dangerous in a business partnership, so make sure all expectations are clearly spelled out.
Create resolution channels for handling disputes. In practice, sharing responsibilities and decision-making power 50/50 doesn’t usually work well. To avoid conflict and resentment, it’s a good idea to clearly identify each partner’s area of responsibility, and determine how decisions will be made in the event of a disagreement.
Establish communication routines. Something as simple as having coffee together every morning can go a long way towards making sure misunderstandings don’t arise. It’s critical that all managing partners, whether there are two or ten, are able to communicate effectively with each other – so make it a top priority to ensure that the lines of communication are open.
What happens if it doesn’t work? If you’ve done your due diligence and structured your partnership agreement properly, the impact of a “business divorce” won’t be as painful. If you’re unprepared, however, the consequences can be disastrous. Don’t take this chance – contact us, business lawyers in Miami, Florida to get started with a partnership agreement for your business. And, check out this blog entry for more on this subject.