Starting a company is an exciting time in every entrepreneur’s life. After all, the ability to choose who you work with, how to allocate resources, building a new brand, and succeeding is the goal of every company. Getting a company started, however, takes careful planning to ensure these goals are achieved.
After all, without proper planning and strategy, your company is liable to struggle under the conflict of problems that arise over time. Starting a company with a new partner involves shared resources, capital, and responsibility. It’s important to ensure that these steps are followed to prevent gaps in your business planning.
These five things will help you successfully start a company with a new partner.
- Run a Background Check
It seems counterproductive, but starting a new business involves considerable trust with a partner. Using a website like CheckPeople can help you establish the actual reality your partner brings to the business, without having to compromise your relationship.
After all, not everyone is forthcoming with their failures, especially in the business or financial sectors. Having a minimal history of your new partner’s past could seriously impact the livelihood of your company.
Detailed reports will disclose any criminal history, financial accounts, civil lawsuits, and social media accounts for the person researched. It’s confidential and discreet, meaning they’ll never know the report was pulled. By having a clear history, you can make an educated and informed decision on how to proceed with your company.
Histories that highlight financial difficulty (like loan defaults, judgments, or bankruptcy), criminal activities or serious value shift from your own should be considered carefully before proceeding.
- Openly Discuss Core Values
Talking to your business partner needs to extend beyond your business idea; it needs to be a seamless collaboration between two minds into the goals and objectives of the company. Make sure you both can sit down and discuss where you want the business to be in the next fiscal year.
Identify the main objective of the company and the size you’d like to scale it to become. There may be issues between you if one has an idea for a small-scale side business and the other is dreaming of a national brand.
Consider how social media and online activities are going to influence your company’s brand. Discuss how you’d like to present yourself online as a business. Talk about politics and current issues. Make sure that the values you both have are cohesive to working together long-term.
- Define Your Roles and Responsibilities
With the excitement and buzz that comes with creating a new company, many partners opt for a more relaxed approach to business responsibilities. Unfortunately, having poorly defined roles can cause conflict and chaos between partners, especially if one partner is doing more than the other.
Take the time to outline the major roles that need filling within the company, from job titles to responsibilities. By clearly defining the job of each partner, you’re less likely to disagree long-term.
- Always Be Honest and Upfront
Remaining silent on key disagreements isn’t going to help your business progress, it’s going to cause more problems between the partners. That’s why it’s always important to be candid and upfront with your business partner, even with disagreements.
Being business partners means having an open and honest communication channel, despite disagreeing opinions. Learn to discuss issues without judgment and try to resolve them in a fair and compromising way.
- Put It All in Writing
Your business is only as strong as the contract you form. It doesn’t matter if your new business partner is a long-term friend, spouse, or family member, always draw up legal documentation to support your business.
Make sure to include the business structure, financial contributions of each partner, key roles and responsibilities, business objectives, and how decisions or disputes will be handled in the legal documentation. Also, include the steps and resolution should a business partner want to leave the company.
By writing out the details of any issues, concerns, successes, and failures of the company ahead of time, you’ll have a solid plan in place for when difficulties arise within the company.
Starting a business with a new partner is a fun and exciting time for most entrepreneurs. After all, no one starts a company with the intent of failing – it doesn’t make economic sense. By taking the time to implement these five steps before joining a new partner, you’ll help minimalize any future problems or conflicts.
Running a background check, openly discussing core values, building on business goals, and getting everything in writing will help you develop a confident and secure start to your company.