Do you need a partner for your new business? If so, who should that partner be? It can be hard to find the right answers to these questions. It's even harder when a friend asks to become your partner.
But that's exactly what's likely to happen if you launch a successful company. Suddenly, your friends, acquaintances, and perhaps even family members, will start wanting to join up with you. Taking on the wrong partner at the wrong time can spell failure, so chances are you'll have to say no to some or all of these requests. Handling this situation the right way can help you preserve both your business and your relationships, according to Alex Daly, founder of Vann Alexandra, which manages crowdfunding campaigns for its customers.
Daly was working at a film production company when she learned to launch successful campaigns on Kickstarter and other crowdfunding platforms. That made her an expert in a new and desirable field and pretty much compelled her to launch her business and fill the many requests for assistance she was getting.
"I wasn't sure it was the direction I wanted to go, but I really couldn't ignore the amount of business coming at me," she says. Even so, creating the new business came with quite a lot of angst. "Carrying someone's project is a big responsibility," she says. "I'm sort of taking care of their baby, and I was doing it on my own."
Daly began to worry that she was carrying too much responsibility alone, and started casting about for a partner to join her in her business. It was a tough sell, though, because the business was entirely commission-based. Since she might be paid nothing if a campaign failed, it seemed too risky a proposition to potential partners.
But then things started going right. First, Daly worked on crowdfunding with an Oscar-nominated director. Then she was tapped to manage Neil Young's campaign for Pono which became a huge success. "That's when it really blew up into an actual business," Daly says. At this point--perhaps unsurprisingly--she started getting serious interest from friends and acquaintances in joining her in the business. There was only one problem: Daly no longer wanted a partner.
How did she protect her business and preserve her friendships at the same time? It wasn't easy. Here's what she learned:
1. Understand the difference between needing a partner and being afraid to go it alone.
When Daly got over her fear of taking responsibility for other people's beloved projects, she realized that she didn't need an equal, she needed employees who would take direction and expand her capacity by taking over some tasks at her direction. "So instead I hired a project manager who is excellent and I just brought on a social media manager because I'm not very well versed in that side of things."
2. Ask what this particular partner would bring to the table.
"What I realized is that unless your partner is bringing in at least half the business, or provides needed skills you don't have, you should do it on your own and just get through that scary experience when you're first building your business," Daly says.
3. Have a trial run.
Before a friend turns into a partner, he or she should spend a lot of time working with you in your business. Ideally, at least a year, Daly says. That gives your friend enough time to see how the business functions and how to create success, Daly says. And you can see exactly what value your prospective partner would provide.
4. "It's not you, it's me."
If you must reject a potential partner, be sure to place the blame squarely on yourself. "No matter what the conversation is where you say a work relationship isn't going to work, it helps if you als0 say, 'It's nothing against you, it's more about me,'" Daly says.
5. Leave the door open.
Do everything you can to ensure a strong relationship for the future. That might include leaving the door open for future partnership discussions, even if an actual partnership seems unlikely.
"If this person means something to you, it makes sense," Daly says. When you reject someone as a business partner, no matter how gracefully, that person will likely feel rejected, she adds. "We're all human beings."
6. Don't procrastinate.
Whatever you do, Daly advises, if you know a partnership won't work out, say so as soon as possible. "If you let your feelings about it drag on, it's going to seem so much worse by the time you do have that conversation," she says. "If you bottle up that dissatisfaction it will turn into resentment and you can lose a friend because of it. So bite the bullet and have the conversation immediately. It'll be worth it if you have the courage to do it."