Starting a business and growing it is an uphill task, especially if you are doing it alone. It requires lots of attention and finances that may not be readily available to many entrepreneurs. Finding useful Business Partners is a good way of easing the burden. In fact, most entrepreneurs prefer launching their businesses with at least one or two Business Partners who help lessen the load.
Sherry Fox, Co-founder and chairman of LumiWave says that finding a good business partner is a key factor in determining the success of your company. Unfortunately, choosing the wrong partner may be worse than having none at all. You need partners who share the same vision with you. Sabrina Parsons, CEO of Palo Alto Software, has likened a business partnership to a marriage so that if you enter into a bad partnership, your business is likely to fail. But how and where can you get partnerships for your business?
Define Your Needs
Before you set out to bring in partners into your business, you must be clear in your mind why you want to bring them. There are other ways of raising money without necessarily bringing in a partner; for example, loans and selling equity in the business. However, there are advantages of bringing in partners because, in addition to capital, they bring in new talents and productive capacity. If you can be clear in your mind why you prefer to get funding from partners and not any other source, you will be in a position to manage the rest of the process.
Start with Your Network
As an entrepreneur, your connections are the best candidates for potential business partners. Jon Weston, CEO of LumiWave and Fox’s business partner says that reaching out to your professional network can provide a rich list. “I’ve received good information and direction from the diaspora of my [previous] companies. General networks or online community groups are too anonymous to find good feedback.” Referrals from friends can also be helpful but you should gauge the person making the referral before considering his/her recommendation.
How to Evaluate a Business Partner
Once you find a potential business partner, you should consider the person’s personality, values, background and experiences to ensure that you can complement each other. This is not to say that you look for a clone; you need someone who can fill the gaps where you have weaknesses. If you are looking for partnerships for the purposes of funding your business, you should satisfy yourself that the prospective partner has the money.
Once you are satisfied that a particular person or persons are fit and willing to be your business partners, the next thing is to have a partnership agreement. The agreement will guide your relationship by defining rights and obligations of each partner to avoid future misunderstanding. It will be useful to have the agreement drafted by a lawyer to ensure that essential terms are not omitted.