When It Comes to Choosing Business Partners, Look Before You Leap

2. Be honest with your own strengths and weaknesses. Like #1, above, it helps to know yourself and how you need the other person to contribute. Are you looking for a financial partner? Someone to share the workload? Do you need a creative mind to balance your managerial one? What strengths and weaknesses overlap?
3. Don’t fool yourself. As with personal relationships, we may turn a blind eye toward certain behaviors because we really just want the relationship to work out … for reasons having nothing to do with the other person. David saw Kevin undertaking major financial burdens (in the form of apartment renovation), and doing so at a time when Kevin did not have a lot of disposable cash. And why? For the adult equivalent of “all my friends have [one].” Kevin’s financial irresponsibility was a definite warning signal. David was wise to keep his eyes open.
4. It’s never too late. Entrepreneurs often feel pressured to start a business right away because they might lose a competitive advantage, or the potential business partner might walk away. In some cases, you might be right that you can’t wait forever. Nevertheless, that doesn’t mean that rushing into a new venture is right for you, either. If David had rushed to form a company with Kevin, he would have found himself tethered to a company with an AWOL owner, and possibly incurring a lot more in expenses to either keep the company running or dissolving it altogether.
5. Get it in writing. Mr. Goat didn’t think through what would happen if he went down the well. And many entrepreneurs don’t think through the possible permutations and options in starting a business with another. That’ s why having advisors on board—legal, accounting, coaching, etc.—are so important in guiding you through this process. Putting your observations and desires in writing helps crystallize your thinking about the relationship.

Entrepreneurship is a calculated gamble. That’s why making sure you have a business owner agreement before you form the business is so important. If you “look before you leap”—especially when choosing a business partner—you can ensure that you’ll leap into abundance instead of a dry well!