Pros and cons of starting a business with a partner
One of the big question facing most all start-up entrepreneurs is whether to go into business alone or with a partner. There are pros and cons to each side of the coin, and a lot of the answer to the question of whether or not it is a good idea depends on who you are, what your goals are, and who your partner would be. However, the following is a look at some of the reasons to have a business partner, and some of the reasons not to. It is up to you to weigh these reasons to determine if having a partner is right for you:
Pros of a partnership:
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- There is a relative amount of safety in numbers. Basically, it can be easy to get caught up in your excitement of your idea, and overlook some basic weaknesses or flaws. Having two heads is usually better than one, it allows you to discuss issues, make decisions, and bail each other out, or point out good sense when one or the other is leading down a destructive path. It is kind of like having a built in system of checks and balances.
- Starting a new business generally requires a significant amount of time and effort. If you can split the load with someone you will still be able to spend time with your family, have a day off if you are sick, go on a vacation occasionally, etc. If you are in business alone, you have to be there when you have to be there, no matter what. So, having a partner means sharing the load.
- A business partner is a great way to ensure your employees are motivated and going to do what is best for the company. Having a partner is going to be different from hiring someone to manage your business, because they will be motivated by more than just earning their bi-weekly paycheck. Instead they will have the motivation of working hard to not just earn some, but to see the business succeed and thus earn even more.
- You can find a partner whose weaknesses are your strengths, and whose strengths are your weaknesses. Partners can contribute complementary skills. For example, if you are great with the numbers and organizing stuff, but actually talking to people and making sales is not your thing, you could partner up with someone who is great at that, and together you make a better whole.
- A partner can mean less capital coming out of your pocket, and less risk placed directly on you. Basically a partner means having someone to share the expense and risk of business start up with.
Cons of partnership:
- Well, probably the biggest con is that if it is your idea, and it does become immensely successful, you will have to share the rewards. So, in other words, it can mean less profits to you directly.
- You will lose total control over the business. When it is yours alone, the decision making is up to you, and you do not have to consult with anyone. Having a partner means having to put up with their opinions, whether they are educated or not. It also means having to deal with their whims, and any problems they may have in making decisions, etc.
- You won't have the satisfaction of being able to say you did it yourself. The fact is, if you have a partner, you will have to share the recognition that will come if the business is successful. While this may not be a big deal to some, it can be really disheartening to others, especially if it was their dream or idea that was put into place.
- A partner can be a disaster if his or her judgment is not good. Just like having someone with complementary skills can mean greater success and a better whole, having someone with poor judgment can be the final nail in your business coffin.
- Like any partnership, marriage, friendship, etc. you run the risk of personal problems, personality problems, etc. getting in the way. If you and your partner have a falling out you may have to sell out your share, or work in unpleasant conditions. In addition ot that you run into legal issues should one partner die, etc.
