Starting a new business is an exciting experience, but it also takes an incredible amount of work and partnership in order to be successful. Often times when friends decide to become business partners, the friendship ends up turning sour. Why? Usually, ground rules weren’t established or one of the friends reneged on the business plan when the workload got heavy and the pressure built up.
Without proper planning, collaboration and communication, your business can crash, especially if your partner got frustrated, walked out and left you to deal with business matters on your own. So what are some questions you should ask yourself before going into a business with your friend?
- Does your friend have habits you can't tolerate?
- What strengths will each of you bring to the business?
- What if the business fails?
- What if one wants out?
- How will final decisions be made?
- What does success mean to each of you?
- What are you and your partner's short-term and long-term and goals for the business?
We caught up with Tamie Boodie, co-founder of Some Like It Vintage, an online vintage fashion store which was developed with her best friend, Taja. Boodie shared her experience about starting a business with her best friend and she proffered some advice on going into business with friends.
DO'S AND DONT WHEN GOING INTO BUSINESS WITH FRIENDS
- Set specific goals, both short term and long term, for the business.
- Write down expectations of the business and of each partner.
- Delineate each partner’s role in the business.
- Seek advice from other business owners who have had entrepreneurial partnerships.
- Ensure that all monetary transactions are noted and documents pertaining to such are can be accessed by each partner
- Go into business together solely because you are best friends.
- Go into business with a friend that you do not trust with your own money.
- Unfairly distribute workload.
IS GOING INTO BUSINESS WITH FRIENDS A GOOD IDEA?
Honestly, based on a lot of stories that I have heard, going into business with a friend is not necessarily the best thing to do. Business issues can and most times affect the friendship.
In my case, I decided to go into business with my best friend because of the fact that I am super secure about our friendship. We've been friends for over twenty years, and I have never had a reason to suspect ill-intentions. I trust her with my money, and she likewise. Also, and most importantly, we have the same interests, goals and expectations where the business is concerned.
Never partner with a friend for a business venture if you can't trust her. It will only lead to conflict in the end.
Will being friends and business partners change anything?
TM: We decided to go into business with each other because, even before we were "officially" in business together, we were playing the role of business partners. We were vintage shoppers for years before we decided to make it official. We were always super supportive of each other, so making it an official partnership was effortless. This is apart from the fact that we both love love love vintage clothes and accessories.
Has going into business with your best friend changed your friendship in any way?
TM: Not really. What it has done, though, is to further highlight our individual strengths and weaknesses where our type of business is concerned, while fostering our individual growth, which is definitely a good thing.
What are the benefits of having a friend as a business partner?
TM: Having a friend as a business partner can offer more flexibility in terms of work schedules. Since you guys will most likely be around each other, business meetings would be easier to set up and conduct. A partnership like this also sometimes makes the work seem less stressful and definitely more fun, since you have to be around someone whose company you actually enjoy.
If you are not 100% secure in your friendship, think very carefully before you decide to go into business with your friend. Business has ruined a lot of friendships; however, I am not saying it can never work. The key is to ensure that there is trust, honesty, understanding, similar goals and expectations and most of all great communication.