Myself and a partner just recently reached an agreement, and we’re headed off on a new venture together. I’m as exciting as I am nervous. Our skill sets overlap somewhat, but we mostly compliment each other’s. That’s one reason I feel we have a good chance.

Things just kind of fell into place and it seemed the right thing to do. One of the things that I was pleased with, was that our two visions of the future were pretty much the same. If you’re starting up a software company, it might be difficult if one partner wants to make just enough to not worry about money, and the other partner wants to become the next Microsoft.

Anyway, thanks again!

Mike
http://www.everonit.com
http://www.smbitpros.com

This is an excellent post, from my personal experience of starting a business with two other partners and now growing the business with a total of six partners, your points are spot on. We have added partners through personal relationships as well as professional relationships with key employees. Each partner at our company brings a different perspective and skill set to the table that makes the group as a whole stronger.

I would add to your post that is vital to also establish a clear operating agreement for your company that is fair and clearly determines how operational and strategic issues are decided and managed by company directors.

Initially, when you first start your business, the relationship among a partnership is very informal and based on mutual understanding. As your business continues to grow and more reward/liability is at stake, company operations become more complex, and additional members are added it becomes impossible to operate without a strong operating agreement and structure for management. Proper preparation in the beginning for the evolution of your business will save you a lot of headache/heartache in later years.

In line with this suggestion, make sure you work with legal counsel that has significant experience in corporate tax law and structures. There are many many ways to setup a new entity and the right way for you is determined by the goals of your partnership, the personality of your partners, state tax laws, etc etc and a good legal adviser can walk you through an extensive process to determine the right structure. Legal issues and advice can obviously go on for ever!

We respected each other’s individual business achievements. By 2001 or so, we worked on a few projects together developing custom media for Fortune, Fortune Small Business and Business 2.0 magazines. It was Amy’s account and she recommended me as a content developer on the project. Suddenly, we realized: We were a good sales/editorial team.

Again, I would hesitate to find a business partner on a social network. If you’re starting a business with a partner, you’re going to need to trust each other with a range of critical items (finances, health care coverage, etc.). That type of trust doesn’t occur by accepting a LinkedIn invite.

In our case, Amy and I had a decade of experience working with each other and developing trust with each other.

My advice: Look in your current rolodex for a potential partner with whom to launch a business.

I am in the “all on my own” boat and would love to have a business partner to share ideas and build my Managed Services practice with. Are there any good suggestions for finding a business partner? Linkedin? etc?

Good partners will disagree frequently, I think, and force each other to come up with slightly revised and improved strategies. And you need to have a strong partner agreement in place — a true contract — to help you navigate business periods when you simply can’t agree on a major decision.

I cover partner agreements/contracts later this week.

One point you missed is that partners need to be able to agree to disagree at times as well as know when to compromise and build consensus. Just my $.02

Stu