24 Feb Why Most Partnerships Don’t Work
If you’re a startup and you don’t expect to make money right away, taking on a partner might be the better option. Partnerships can achieve much greater levels of success – and more rapidly – than if the same individuals went after the same goals alone. I watched many business partners try it together, but in most cases they fail. It’s not because of hard work, money or their smarts. It’s because they were not a good match. Take a look at a couple of the best partnerships in history:
Larry Page and Sergey Brin of Google & Steve Jobs and Steve Wozniak of Apple, Inc.
These partners were not only light years ahead of people in their related fields as far vision, but they utilized each other’s skills to elevate their success to another level. I’m not saying all was roses and daisies all the time. Some of them parted ways for greener pastures (Jobs and Woz), while the others stuck it out through the hard times to realize an even higher success (Page and Brin). Either way, their companies are thriving today because of the exceptional match in talent and style that served as the catalyst.
If there’s anything we can learn from the partnership before us, it’s that getting into business is fun and exciting, but it can also be a very painful thing. That’s just the life that entrepreneurs choose. There a lot of ups, a lot of downs, and a lot of lessons.
Many partnerships could have prevented lost opportunities, lost profits, and a lot of pain if they would have clearly defined the parameters of their partnership at the beginning of their working relationship. This is important, of course, to ensure that everyone knows what’s expected. But experience professionals know this is only half the battle.
I’ve mentioned before that partnerships are all about chemistry. How true this is.The most successful partnerships are like a committed relationship based upon a mutually agreed-upon commitment to one another involving exclusivity, honesty, openness, and trust.
Is this starting to sound like a marriage? Well, it should.
Like marriages, business partnerships often begin with enthusiasm and high expectations – and have the same chances of ending in chronic bitterness and legal proceedings. And yes, there are heartbreaks. Except that breaking your business partnership can be worse than going through a divorce. Friendships are lost in the falling out of a partnership, assets are split, and there is a constant battle over who gets custody of the kids –and by kids I mean equity.
It’s important to know as much as possible about a potential partner, including how his or her finances and family life may affect the business, before signing on the dotted line.
Try dating first…
Starting a business involves a lot of commitment, and making those commitments with someone who turns out not to be what you expected can be disastrous. The relationship with a business partner is ultimately like the most important relationships in one’s personal life. “To meet up at a coffee shop and be ‘romanced’ by a partner and quickly jump into it is a dangerous game,” says Sloan. “You want to accumulate as much time as possible [with someone] before you formalize any kind of partnership.”
Here’s an idea: You can cooperate with potential partners on small projects to see their style before you take any kind of plunge. For example, many small businesses don’t even have an official, written-out business plan, but working on a detailed business plan with a partner can be a good way to see if their values and goals are in sync with yours.
It takes time to get to know each other and build trust. A business relationship should be a balanced partnership. Everybody wants to gain; everybody has something valuable to give (and something to lose). It does not inspire trust if you’re always trying to have the upper hand.
Know When it’s Time to Break it Off…
It’s important to take action when you recognize that your partner is not the right match. Unless you have unlimited time and a plentiful budget, know when to cut your losses. The Steves (Jobs and Woz) were a good match in talent. They had complementary skills – Jobs with the vision and marketing and Woz with the attention to detail and engineering. http://bessonagency.com/partnerships-dont-work/But in the end, they couldn’t work together. They had different goals and couldn’t agree on anything, so they split.
Before you partner up with anyone, make sure you have similar life goals… especially when it comes to work. We can’t all be college sweethearts like Larry Page and Sergey Brin (met at Stanford), but there are people out there who have the same goals you do and the same aspirations. Once you find each other, you have nothing but opportunity in front of you.