Finding the right partner for your startup is not a task that should be looked upon lightly. Shawn Hermanson, co-owner of The Buzz Revolution, a small entertainment PR and marketing firm in Denver, knows this all too well. A serial entrepreneur, Hermanson once teamed up with a close friend to start a golf tournament hosting company. The outcome was a disaster.
“Things were going great,” he recalls. “[My partner] helped with the planning and got sponsors. However, the day of the tournament, he thought we were done working. So he decided to do what he did every time he played golf, which was have some drinks. He left me in charge of everything. He didn't want the business to interfere with his fun day of playing golf. I was livid.”
Following an angry confrontation, Hermanson fired his new partner. Sadly, the experience had negative repercussions on the friendship. “We haven’t talked in five years,” he admits.
As this example indicates, sometimes a close friend is not an ideal partner for a startup. Frequently, the relationship can become strained or ruined completely as a result of the business upstaging the friendship. For Hermanson, it proved to be a key lesson learned. What are some other tips—and caveats—to keep in mind when looking for an effective partner?
Look for someone with different skills
As Hermanson found out the hard way, teaming up with a pal on an early-stage company can lead to failure. He is now more strategic when it comes to selecting partners and cites his current partnership at The Buzz Revolution as a successful fusion of skills. While his strengths are anchored in client relations, he says, his partner excels in public relations and marketing. The synergy has reaped handsome dividends for the business.
“Before I teamed up with Katie Hinkle, I was taking care of all of the PR and marketing stuff and doing okay but once I teamed up with her, the business exploded,” he says. “Together, our skill sets complement each other marvelously. It's a great combination.”
Find someone you can communicate with
In the same way that communication is essential for a successful relationship, it is for a business partnership. Make sure whomever you pair up with has the same goals and expectations about the business as you do. And always make decisions together instead of in a vacuum. Transparency is critical and could be a make-or-break proposition for companies just starting out.
Phil Masiello, who’s had several partnerships during his three-decade entrepreneurial career and is currently the president and co-founder of 800razors.com, an e-commerce platform, agrees. “The partners should discuss all relevant issues,” he says. “It is very important to set aside a prescheduled time each day to discuss the business. What partners should not do is break off into silos and make all their decisions related to their expertise while the other partner makes decisions based upon their expertise. This will lead to long-term resentment.”
Steer clear of alpha personalities
This doesn’t mean that you should choose a meek, passive person who you can easily dominate. However, if you want to pre-empt the possibility of a power struggle, then it might be wiser to team up with someone whose ego won’t clash with your own. Find someone who knows how to compromise. You’re building a business and trying to move it to the next level, not engaging in battle.
Drawing upon experience, Masiello echoes the sentiment. “Most of the unsuccessful partnerships I’ve had had to do with the fight for control,” he says. “If the other party’s sole focus is control over the business decision-making and operations, then you chose the wrong partner.”
Launching a startup is filled with challenges. One day can be promising while another can be a study in Murphy’s Law. With so much at stake, why risk your burgeoning venture by teaming up with a person with a negative outlook—or worse, with no record of success? Don’t stack the odds against yourself.
Trevion Blanding, COO and partner of Small Business Owners of America, which helps entrepreneurs start companies and obtain loans, concurs. “Knowing your partner’s background and track record is extremely important because it will let you know if this person has been successful in past ventures or unsuccessful,” he says. “When starting a company, you want to surround yourself with winners. The old adage ‘If you are the smartest person in your group you need a new group,’ is true. Make sure you do your research on all potential partners.”
Have a shared passion
Although this should be obvious from the start, it bears repeating. Because startups are high-risk enterprises, it’s imperative that you team up with someone who has a passion for your business or sector. This is important particularly when times get tough.
Says Blanding, whose firm also helps business owners find the right partner: “You never want to get into a situation where the partner gets bored and decides to leave the business a year later because they lost enthusiasm for the venture. When hard times and difficult challenges come, you want someone who will stay the course and not give into the pressure of being an entrepreneur.”
In business as in life, it’s essential to find a partner whose skill set and demeanor balance your own. To do otherwise creates the kind of disharmony and conflict that will surely put your new business at risk.