Tips for Going into Business with a Friend: You might be best friends who share similar passions, but going into business with each other isn’t always the great idea you think it’s going to be. That isn’t to say that friends haven’t succeeded in their business endeavors together; there are a lot of partnerships that are thriving and friends who have become even closer thanks to the experience.
However, as there are so many pressures in business ownership and management, it will certainly be something that tests your friendship, which is why you should keep the following tips and considerations in mind if this is something you and your friend are discussing to do together.
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What Is Your Relationship Like?
The first thing you need to do is have a long, hard think about your relationship with this friend. Is this a balanced friendship? Do you trust them to have your back when you need them? Are they honest with you, even at times when the truth might be hard to tell you? Have you managed to navigate your relationship through hard times in the past? If the friendship is imbalanced or you have your doubts about this person, you should certainly think twice about going into business with them. You need to know that you can rely on them when things get hard because they will, as well as trust that they won’t take over and push you to one side when the business is up and running.
If you are both confident in your relationship with each other and there is trust between you, that’s a great position for you both to be in. Nonetheless, it’s always a good idea to set out your boundaries with each other in the early stages of planning your business for clarity and to try and reduce possible tensions that could arise later. For example, say when you are discussing business, it is strictly business, nothing personal. You should also make it clear how much time you both have to dedicate to this venture, as one of you might have more commitments than the other and therefore not be available at certain times of the day or evening.
Another thing you should decide on in the early stages of your planning is who is going to be responsible for what. One of you might be better at sales pitches and promotion; therefore, marketing and sales should be something that they take the lead on. The other might be great with bookkeeping, and company accounts should be their responsibility, along with hiring an accountant to help. Managing HR tasks, sourcing suppliers, creating products, etc., all of these duties need to be divided between the two of you, and you must make it clear early on who is responsible for each task to increase productivity and leave less room for confusion and clashes.
Have a Contract
It doesn’t matter how close you are to each other; the bottom line is you’re going into business with each other and you both need to protect yourselves in these circumstances. You must get contracts are drawn up for you both to sign to make it crystal clear who is entitled to what when it comes to your company. You should also discuss what will happen if one person decides that they no longer want to be involved in the company and how they will get their investment back etc.
Give Each Other Space
When you’re starting a business together, you will be spending a lot of time in each other’s company to get through your seemingly never-ending to-do list. Enjoying time together as friends is also still important, but you should also make sure that you’re giving each other some space, too. Otherwise, it might be hard not to let these pressures take over, and you could start to irritate each other. Spending time with your other friends or relatives is a good opportunity for you both to switch off and focus on something other than the business for a little while, which you will both need to do.
Consider Studying Business Together
One of you might have recent experience in business management, or maybe both of you do. However, if this isn’t the case, you should consider studying this topic together. Just because you have come up with a great idea for a company doesn’t mean you know how to put it together and run it effectively, which is why a business course could be useful. If you don’t already have an undergraduate degree in business, don’t worry, you can still get an MBA with any degree at certain universities with more accessible courses. You can even take an online course with each other if that would be easier for you both to fit in around your schedules. It is worth it, as you’ll become more familiar with the complexities of business management, and this information will put you both in a much stronger position to make your business a success.
Communication Is Key
If you are ever unsure about something that is happening in regards to the business, make sure you sit down and explain your concerns with your friend and business partner straight away. It can be easy to push things under the rug if you’re worried about starting an argument or feel silly for not understanding something, but it is far better to get this out in the open so it doesn’t get worse. It’s also a chance to clear up any misunderstandings that might have occurred before they turn into toxic tensions. Never make assumptions about what each other are feeling or doing, but instead, sit down and talk it out calmly to make sure you’re both on the same page and happy. If there is an issue, this is also the opportunity to find a resolution that you’re both comfortable with.
Starting a new business is both exciting and daunting, but there are other kinds of pressures when you go into business with your friend. While this could be the start of an incredible journey for you both, it will also test your friendship, which is why you need to think carefully about the points above before moving forward with your plans and use these tips to help you navigate this situation as effectively as possible.