When choosing a business partner, you need to find someone with whom you share similar ideas for your company’s success. If you cannot work together as a team, the result will be a failed business or a damaged relationship. Here are some questions to ask potential business partners before committing.
Do You Have the Same Vision for the Business?
You and your potential partner must agree on the plans for the company. Those plans will influence how you run the business. For instance, maybe you plan on expanding the business to external markets while your partner does not intend to go past your region. You will be working towards different goals for the company, which will conflict.
What are Their Strengths and Weaknesses?
People prefer business partnerships because each partner comes with different strengths that contribute to the growth of the business. While you are great at handling the company’s financial aspect, your partner can be good in sales and marketing. A suitable partner will bring in new skills that you may lack to complement your partnership.
How Much Money Will Each Partner Contribute to The Business?
When forming a partnership, each partner may not contribute an equal amount. The amount that a partner contributes will determine the ownership equity. If the partner contributes a third of the capital, then he or she is entitled to a third of the equity. Make sure to keep contribution records to avoid future disagreements.
How Much Time Will They Be Dedicating to The Business?
The time that business partners dedicate to the company is as important as their capital input. A startup requires a lot of commitment before stabilizing. And when one partner is putting in long hours than the other, it can cause conflict. If both partners have an agreement from the start, none of them will have unrealistic expectations from the other.
Do You Agree To Put The Agreement In Writing?
It is best to have a partnership agreement detailing the terms of your agreement to avoid conflict. You can include details like the name of your partnership, each partner’s contribution, management guidelines, etc.
By asking such questions, it is easy to pick out your business partner. If you feel like the idea of getting new business partners for your company is appealing, reach out to Evolt Capital to help grow your business.