Many small business owners swear that without their partners they never would have gotten where they are today. Others are certain that going solo was the right decision, and a partner would just have slowed them down.
Here we try and highlight both sides of the argument for you to come to your own conclusion about what is going to work best for you:
Pros of having a Partner:
- You can keep each other motivated on the hard days
- There is someone else you can trust to watch things when you are away
- Often skills you don’t have they will have, and vice versa
- Someone else to contribute capital, credit, collateral to the business
- A good partnership can get started faster than a single person
- There is someone else to bounce new ideas off
- It isn’t lonely at work, or at the top
Cons of having a Partner:
- It takes longer to be able to pay yourself what you deserve, since you are splitting the profits
- You can’t do everything the way you want
- There is the constant concern that the partnership will become unequal or unfair
- You may eventually want to go in different directions or at different speeds
- You will be personally liable for decisions your partner makes unless you form a corporation or LLC
- Most decisions take longer since you have to talk them over first
- Employees can be let go but a partner you are stuck with unless you actually buy them out
To be sure, there are pluses and minuses to having a partner that you have to carefully consider. If you need a partner because they the capital or credit you lack, then you may have to live with it until you are in a better position yourself to go solo.
Or you may really need a partner to help keep you on track and motivated to continue even when it gets tough.
If you do take on a partner, and I can’t stress this enough, then you need to have a rock solid partnership agreement in place BEFORE you do anything else.
If I had a dollar for every business partnership that didn’t work out and ended badly, I’d have infinity dollars and counting.
And your partnership agreement must spell out in very clear black and white no possibility for misunderstanding how the partnership can be broken up or how one partner can leave- that includes how you value the company, what they can take with them, how they will be paid out for their share- everything.
If your partnership agreement was nothing BUT how the partnership ends you would be ahead of 90% of other partnerships. Don’t make the mistake of thinking you are the exception because you are family or you’ve known each other for years or you are married or anything else- do this or really regret it later.
Either way, as long as you know what you are getting, and giving up, by having a partner, then the decision should be easy.