Before setting sail with a business partner, test the waters
Starting a business, is simple. All you need is an idea and a go-get-em attitude. Starting a successful business, well that usually involves a few more steps. Part of the difficulty of making a business – successful, is providing value to your target audience that’s better than any other offerings out there.
A lot of entrepreneurs then, including ourselves, turn to partnerships as a means to create standout businesses. From a financial point-of-view, partnerships are an opportunity to increase a business’ share of capital, but really they’re much more than just money. It’s a relationship where both diverse and shared thinking is promoted, where passion and enthusiasm can grow, rather than fizzle out – which is more likely for an individual. There are many other specific benefits, but you need only to think of the ‘two heads are better than one’ adage to recognise those.
Conversely, different opinions can also lead to interrelationship turmoil, which can ground a project to a halt. Likewise, the project could continue to roll on, though there may be an imbalance of power throughout the business’ trajectory, that could influence one or more persons to resent the others in the partnership. To avoid these circumstances from happening, unfortunately there’s no step-by-step answer sheet to follow, as every situation and personalities involved are unique.
There is however, always the opportunity at the beginning of every venture, for partners to hold open conversations. The is a platform that allows each individual to highlight exactly what they want from the business. In our eyes, this has two major benefits.
The first, is it’s your first big clue as to what the person you’re going into business with will really be like. You might say, well I’ve known this person for years, I know their personality, plus their hopes and dreams in life. It’s not until you ask them what they’re really willing to contribute, and importantly sacrifice, that you’ll have a clearer understanding of whether joining them in business is wise.
The second benefit of holding an open conversation, is that it allows all involved to have a clear say on the objectives of the venture. Of course, objectives shift throughout a business’ lifetime, but taking the time to outline major and minor targets before a single sale is made is your best opportunity to direct operations, talk about marketing and whatever else without any external influences distracting.
In our ventures at Hustle, we’ve found the open conversation stage to be a crucial step in the process. We’ve found that the gained clarity on our objectives additionally highlights what skills we’re lacking or jobs that we don’t have the time to facilitate, as such informing us whether we need to onboard others. We’re fortunate that within our agency team, we have a diverse team with various skills and experience. So we often dip into that talent pool before looking for external help. In a fair exchange, our team is compensated for their efforts in this work outside of their salaries through bonuses, assuming that their involvement leads to their personal objectives being achieved.
Learn from failed partnerships, don’t let failure stop you from collaborating
Where there are highs, there are lows, and many can point to the times they’ve been burnt by partners in business ventures. In Episode 4 of The Venture Beyond Podcast, Anthony shares his own story of partnership failure, detailing how at age 19, he was recruited to help steer a business, though was later left red-faced when he realised his partner was taking advantage of his business nativity.
Years later, after rolling up his sleeves and working for organisations that fairly compensated his efforts, Anthony began to stand on his own two feet in the business and technology industries, then deciding to turn his attention to starting ventures again. Instead of shying away from partnerships, he actively sought after them, using his previous failed partnership less as a deterrent and more as a learning point. Following a few more partnership fallouts due to different reasons, Anthony has had several partnership successes, including his main business partnership with his brother and fellow host of The Venture Beyond Podcast – James.
Some people argue that going into partnerships with family is risky, but like any partnership the two enter, they mitigated this risk by holding an open conversation in the beginning. Family connection aside, they could trust each other’s motives and approach to the business following this session of honesty, and as a result now together operate their most successful business – Hustle Agency.
Again, open conversations will not break down all barriers in the journey to having successful partnerships, but it’s a great start. The onus to maintaining strong partnerships then turns to taking learnings from your previous business relationships and being willing to be open to learning from new experiences. There’s no benefit from turning away from partnerships after one or a few bad experiences. Collaboration is one of the best processes in developing a business, and something we can’t wait to do more of with interesting, and different people.