Starting a business is always a challenge. But what about starting one with a friend? You’ve heard it before: Don’t mix business with pleasure. This could certainly be the case if you dabble with the idea of going into business with a friend. If you’re not careful, the relationship can turn sour very quickly and hurt your business in the process. On the other hand, a close, trustworthy dynamic could result in tremendous benefits for a business. It is important to fully understand what you are getting into and how your dynamic might change once you are in business.
There are a few things to keep in mind when deciding if this is a good idea or not:
- Test the waters
The stakes are high when you start a business, especially if it involves a lot of start-up capital. To find out if you and your friend will work well together before you make that investment, test the waters on a smaller venture. If you and your friend have collaborated and supported each other successfully in the past, there’s a strong likelihood that you’ll work well together in a business setting too.
- Agree on a mission.
Very early on in the process of launching your company, you need to establish the core values that guide your business decisions.
As friends, you likely already have many values in common. But don’t take that for granted: Explicitly define those values and discuss how they relate to your business.
- Establish roles early on.
Who is the big-picture thinker? Who loves dealing with people face to face? Does one of you know more about marketing? Your friendship gives you insight into each other’s personalities and abilities, which will help you assign roles and responsibilities within the company. There will be times in the partnership when you need to agree to disagree and move forward. Without clear roles, this can create a stalemate, which may end your partnership and friendship. Creating a hierarchy and giving one person the authority to make final decisions makes it business instead of being personal.
- Put it all on paper.
Draw up a business operating agreement before you make any other decisions. This sort of agreement separates your business and your friendship, establishes parameters for decisions like expanding or dissolving the company, and keeps any potential issues black and white. The start to any new venture is fun and exciting, but life happens, and people’s views and opinions change, you don’t want those changes to affect the business as a whole.
Article Source: Katherine Paljug