While it's certainly possible for you to dive into business by yourself, finding a business partner works equally well. The conundrum, though, is how to keep a business partner by your side once you've found one. It takes just a year for 10 percent of cofounders to walk away from each other, and by year four, that number jumps to 45 percent.
But cofounders Alex Yakubovich and Stan Garber have beaten the odds. They've been business partners for almost 20 years--since their sophomore year in high school--and have started not one, but three businesses together. Their latest venture, Scout RFP, just captured a $33M Series C, earning backing from companies like Salesforce Ventures, Scale Venture Partners and and Workday Ventures.
4 hurdles all business partners must overcome
Yakubovich says that, while the comparison might be cliché, a great business partnership really is like a great marriage, relying on communication, trust and compromise. An unwillingness to confront tough issues openly is almost always a partnership killer.
"If you can't have the hard conversations," Yakubovich asserts, "you will only grow hard feelings and eventual resentment."
Ego is another huge issue.
"Partnerships really stay strong when individuals can put the business ahead of their pride and do not worry about 'how things will look'."
And while having similar interests, views and abilities initially can attract partners, Garber says that a lack of diverse skill sets can come back to haunt cofounders.
"When the founding team is built with individuals that all have similar personalities and want to do the same thing on a daily basis (i.e., only development, sales or marketing), this overlap will often lead to conflicts quickly, which can easily cause a break up. You need to have founders with diverse skills and interests that can complement [each other]."
And lastly, you need fantastic accountability to avoid being sunk.
"If a founder isn't showing the same care or urgency as the rest," Garber asserts, "it will be clear to the others and can cause resentment or lack of trust moving forward."
5 ways to build a long-term bond
Yakubovich acknowledges that building a business can be tough, but both he and Garber claim that having a partner you can stick with means establishing an incredible shorthand. You pretty much can know what your partner is thinking, so you naturally gain speed. You also can be more consistent and can enjoy higher predictability. If you want those competitive benefits, there are five essential components to hit.
1. Have the hard conversations early. "The longer you wait, the more painful they'll be." (Yakubovich)
2. Stay calm and think before you act or open your mouth. "When (not 'if') stress goes up in a growing or struggling business, it's easy to let tempers flare and say things you don't mean. The Golden Rule applies and keeping a cool head will save many unnecessary hard feelings." (Yakubovich)
3. Put your ego last; put the business first. "If you can start with that priority clear for everyone, that makes a lot of seemingly complex decisions easier." (Yakubovich)
4. Respect each other. "There is a reason why the group came together, and each individual has a set of skills that is helping drive the company forward. Make sure to recognize that among the team and highlight the wins." (Garber)
5. Have an aligned purpose among the founders. "You're all on the same journey together, and sometimes it's easy to forget the ultimate goal with the day-to-day grind. Make sure to take time to talk about the future, and remind each other why you started the company and the outcome you want to achieve." (Garber)
And if you want to bring someone else into your business as a new partner? As Yakubovich puts it,
"Trust is everything. We default to trusting our partners, employees, customers, and let them show us otherwise. The quickest way to earn more trust is by reciprocating and acting with the same level of ownership that the other partners show."
It's this gain of trust, Garber says, that ultimately allows the new partner to push everyone--and the entire company--to the next level.
So before you make any formal agreements, make sure you're dealing with someone with impeccable integrity. If you can nail this along with the five components, you'll have the simultaneous flexibility and reliability every successful business leans on.