Why Family and Friends Make the Best Business Partners
Conventional wisdom says never to go into business with family or friends. I did. And I’m glad I did.
Maybe it’s because there is a technicality involved here: My dad’s cousin married Rolf’s grandpa’s cousin, which means Rolf and I don’t have a true blood relationship. To us, it doesn’t matter. And we were friends long before we came up with the idea of becoming business partners.
Rolf and I met in 1982 in Berlin. Our families had both moved from Minnesota to Berlin, where my dad and Rolf’s mom worked as teachers in unique German/American school, the John F. Kennedy School. As teenagers hailing from suburban Minneapolis, we had been totally dependent on our parents’ driving to get us to our various activities. The move to Berlin meant instant freedom. Navigating the buses, subways and bike paths of Berlin was something that all kids did with ease – the two of us included. In our current capacity as the owners of a bicycle transportation company, we still hold Berlin as one of the gold standards of mobility.
Our families got to know each other, and it became quickly apparent that we shared more than just a common experience, an independence not typical of a suburban U.S. upbringing, and a love of soccer. We shared something much more important. The same values. At the most basic and important level, I knew what Rolf and his family were: good people.
Our families overlapped for one year in Berlin. His family moved back to Minnesota, as did mine two years later, in 1985. We were not in close contact, but our families kept in touch, even as Rolf returned to Berlin to finish high school at the Kennedy School.
Rolf and I really got to know each other again after graduating from college. We roomed together for a year before we each went off and got married. That was 1995, the year that Rolf started Dero.
And when Rolf asked me to be a partner with him in his business in 2003, I knew that if I was ever to be in business with someone, it would be him. Looking back on things now, we didn’t really know what we were doing (some would argue that that’s still the case). But we learned. And from the very beginning, I knew that I could always count on Rolf to always make smart, unselfish decisions.
That doesn’t mean that we didn’t take our partnership very seriously. We had lawyers draw up all the necessary documents. You know the documents - the ones that are for the bad times, not the good times. Yes, we anticipated that we would not agree on every little detail and that our friendship would evolve into something new now that we were seeing each other 40-plus hours per week. And to some extent, that has happened. But on the really important issues – how to treat customers, how to treat vendors, how to treat employees, in general, how to treat people – we have always been on the same page.
I think about it this way. If you’re going to be in business with someone, why would you not want to work with someone you know so well that there’s no question you share the same values? Chances are that person is a friend. And if they’re not a friend now, they’re going to have to become a friend. The fear of losing a friendship if a business doesn’t work out has always baffled me. Your business partner has to be your friend, regardless if you knew that person beforehand or not.
Maybe we’re the exception to the rule. Maybe we’re lucky. Either way, I’m glad I didn’t listen to conventional wisdom.
HANS STEEGE | Columnist | CEO, Dero Bike Racks
Hans Steege is a co-owner and the CEO of Dero, a Minneapolis-based business that builds bicycle-friendly communities worldwide. Before landing at Dero, Hans worked as an engineer in the machine design and product development industries.