There is an enthusiastic, optimistic quote from Richard Branson which cycles through my social media: If someone offers you an amazing opportunity and you are not sure you can do it, say yes. Then learn how to do it later”. While I applaud his sentiment, and concede that Sir Richard is a far better business person than me, I caution people in business relationships against jumping in too quickly.
Equally, much older clichés ring true: “If it seems too good to be true, it probably is”. Some might say this offers a much more pessimistic view of business. I would say it is a more realistic view. Before you jump in, consider the following:
Does your potential business partner have ulterior motives?
Everybody has his or her own agenda. That's not a bad thing, it's just the truth and something to be aware of. Is your collective agenda on the same page? Do you have the same goals for the business? You might think so, but do you know so?
Will he or she do what you cannot?
Ideally, you want to do business with someone who is going to do what you cannot, or would rather not, do. Is she or he an expert in an area you are not? The value may be in your combination or in the fact that she or he is willing to put the effort into areas you are not. The trick is get both of you to understand where the balance in your relationship is and to ensure that balance is valued accordingly and recorded accurately.
Do you have an agreement with your business partner that each of you understands?
In an article produced by Fairway Resolution Limited on “Prevention”, experienced New Zealand based resolution practitioners discuss common themes in disputes they deal with. For example: “A lack of clarity or agreements that can be interpreted in a number of ways are often at the heart of disputes—both personal and commercial,” Jennifer Mahony.
Before jumping into business, you should take the time to work out what you want personally, then jointly with your business partner and ensure your understandings are accurately recorded in a binding agreement. Your lawyer can draw up an agreement for you but to prevent future disputes it is advisable to sit down with an independent advisor who can facilitate discussions between you and your business partner to ensure your collective agenda is on the same page. The independent advisor can give you objective insights, act as a neutral pathway for each of you to discuss the more difficult questions and set up open communication channels for your future business discussions. For more on this topic, read Fairway’s piece on “prevention being better than the cure”: https://www.fairwayresolution.com/resources/whats-new/prevention In fact, I would go one step further and say “prevention is the cure.” Spend time at the start of your business relationship and along the way to maintain it. This will enhance your overall business performance and give you longevity.