What Are We?... And Other Uncomfortable Questions to Ask Your (Business) Partner
Relationships come in many different forms. There are friends, family, partners, neighbors, co-workers… the list goes on. While the basis for each relationship may be different, if there is one thing that’s universally true about relationships it’s this: a fruitful relationship requires effective communication. This fact applies whether you are searching for a business partner or a life partner.
However, opening up the lines of communication is often easier said than done. Like romantic partners, potential business partners often get so caught up in their dreams and fantasies that they don’t take time to ask the tough questions. They ignore the questions that will help them uncover potential problems and get on the same page about how to handle them. Instead, they tell themselves not to worry; Everything will probably turn out fine. But their willful blindness will lead to their eventual demise.
New business partnerships can avoid this mistake by asking these uncomfortable questions to one another before getting too involved.
What are you looking for in a business partner?
Let’s face it. The one thing we’re all worried about when jumping into a new relationship is wasting our time with someone who isn’t a good fit. Even after swiping right and starting to engage with a potential partner, it’s important to find out exactly what they’re looking for.
In the business context, we need to know whether our goals align with our potential partner’s. Are they strictly seeking fame and fortune? Or are they out to change the world for the better? Do they plan to work full-time in the business? Or do they want to be a silent partner? Questions such as these serve the same purpose as questions like, do you want kids? They help ensure that you are both on the same page about what you hope the partnership will produce.
Beyond simply understanding your business partner’s goals, you should also take some time to discuss their strengths and weaknesses. The most successful partners complement one another. Ask your potential business partner what they bring to the table, and what they’re hoping others will bring to the table. If you’re skill complement one another’s you may have just found your person.
What are we?
A business relationship requires a significant investment of time, money and energy. So, it is best to define the relationship early on. Defining the relationship helps you determine what commitments you are making to one another. Setting your commitments to one another is pivotal because it helps set expectations that allow you to assess whether your partner is truly serious about your relationship.
For example, what is each person investing in the business? What roles will each person play? What is the legal relationship between the two of you (i.e. partnership, LLC, corporation)? Can we work with other companies? After coming to an agreement about each other’s commitments, you should also discuss what would happen if one of you fails to live up to them. Finally, whatever you agree to should be put in writing in order to keep everyone accountable.
Like a romantic partnership, a business partnership may defy neat definitions. That’s ok. The most important part is that you come to a clear understanding of what you can expect from one another. This transparency makes it easier for partners to communicate openly about their responsibilities, building trust along the way.
What’s your credit situation?
Let’s be honest. It’s great when you and your partner have a genuine connection. But as with any partnership, finding the one isn’t just about companionship. It’s also about finding someone who can help you build the future you’ve been dreaming of. So as great as it is that you share the same interests and you never get tired of each other, you need to be on the lookout for red flags.
Red flags are pieces of information about your partner and their past that give you reason to doubt the viability of your relationship. For example, did all of their past business relationships end on bad terms? Do they exhibit negative personality traits such as narcissism or dishonesty? How many bankruptcies have they filed? If you observe any concerning behavior don’t simply ignore it. Your instincts are trying to tell you something. Ask them about their past because it is likely the best indicator of their future. And if you find red flags, run! Don’t let emotion get in the way of logic.
What do you want to happen if you die?
Now to our final question. This is one you can save until you’ve decided to fully commit to your new business partnership.
There are two things that are guaranteed in this world. Death, and Philadelphia sports fans will always find something to be upset about. ‘What happened to taxes’ you say?
Any who.. death is a guarantee. None of us can escape the reaper, and none of us knows when death will arrive on our door step. Despite these facts of life, too few of us take the time we should to plan for the inevitable. This is true for both business and life partners. The consequence is that those we leave behind, in the middle of their grief, have to pick up the pieces and try to find a way to move on.
Repeat after me: “I will not make the same mistake.”
Instead, have a conversation with your business partner about what each of you would want to happen if one of you suddenly passed away. Would you want to carry on the business alone? Add another business partner? Shut down the business entirely? Would you be comfortable with their share in the business being passed on to their wife or children? And if so, what role would they play moving forward? These are all critically important questions to answer. What you decide will determine what you need to do now to prepare for the possibility that the inevitable will come sooner than either of you think.
Finding the Right Business Partner
Finding the one is difficult. There are so many things to consider, and the consequences of choosing the wrong one could be catastrophic. But you’ve got this. Deep breath. Take your time and trust your gut, and have faith that everything will turn out the way it’s supposed to.