Is Joint Venture a Good Option For Businesses?

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christopher gower m HRfLhgABo unsplash 1
christopher gower m HRfLhgABo unsplash 1

Can an old friend or beloved spouse become a business partner – reliable, loyal, sharing your values ​​and beliefs? On the one hand, history knows many examples of the huge success achieved by a group of talented enthusiastic friends Google, Procter & Gamble, Twitter. However, at the same time, the market is replete with cases when a stable and promising company suffered or completely fell apart due to personal friction between partners. It has numerous examples like email marketing firms, App development companies, etc.

Like any plan, the decision to “do business together” has its pros and cons. How to minimize risks, but maximize the benefits of an affiliate management form; what points should be foreseen and discussed before the start of cooperation; what to be prepared for when introducing a friend into the business – we will talk about these and other important points in today’s article.

Portrait of the perfect companion

First of all, partners should mutually complement each other in the professional sphere: let’s say you know how a landscape design project should be developed, and your partner is well-versed in the market and knows how to negotiate with suppliers or regulatory authorities.

When deciding on joint management, try to answer yourself in detail to several important questions.

Does a potential partner share your business enthusiasm? It doesn’t matter whether you are engaged in information technology or selling confectionery – your colleague must be eager to realize himself through the success of the company.

Is the financial position of the candidate for co-owners stable? Solving this issue, it is necessary to abstract from human condescension. It does not matter for what reason the partner has debts, their presence clearly indicates not in his favor. If, taking a loan, he could not calculate his capabilities, then he is not a very good businessman; if debts were formed as a result of any difficult or tragic personal situation – it will draw attention and strength from work.

Stress resistance. How does your henchman cope with critical circumstances? Examine his past activities, perhaps even direct several stressful situations and evaluate whether his method of solving problems is suitable for you and whether you can trust such a partner in a difficult period.

What questions does the future partner ask? The nature of the discussion makes it easy to understand the degree of professionalism and ownership of the subject. Well, if the interlocutor does not show initiative at all, does not require clarification, it means that he is simply not interested in the intricacies of your business or does not understand anything about them.

The most important question – do you really need an equal co-owner? Perhaps there are other tools to solve the tasks, in addition to the separation of shares in the company? For example, a competent and motivated team in some cases can achieve no fewer results.

Where to find a business partner?

Before exploring areas of partner search, it is worth identifying the reason that generally made you consider the partner option of doing business.

The main reasons for choosing joint business ownership:

  • Lack of funding at the start;
  • The need for shared responsibility, psychological support, collegial development of key decisions;
  • Expansion or diversification of a business.

In the first case, everything is more or less clear: relatives, friends or colleagues become partners, sharing your idea and able to complement your business qualities.

When it comes to entrepreneurship that has reached a certain stage of development, a businessman can choose to co-own one of his own hired employees or business partners, whose personal qualities are well known to him: consultants, suppliers, even customers.

Partnership agreement

It is no secret that for most people, even well-known professionals with mild business experience, it is easier to negotiate with clients than with a potential ally. Cooperation presupposes a certain degree of sympathy and trust, which makes cold discussion of slippery questions uncomfortable for the purely human.

However, you should never leave sensitive issues as an opportunity. For example, if you do not agree in advance on the conditions under which the spouses, the best friends of the co-owners of the children, the owners of the children, come to the company, then the uncertainty after a while can lead to a deep personality conflict. For example, one of your spouse’s sons considers it inadequate, while the other considers it a fatal insult. Or the wife of one of the co-owners does not match enough, it will simply be impractical to ask the owner about the relative as a worker outside. There are more than enough reasons for personal communication in business.

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