Want To Start A Business With Your Friends?
While starting a company with your friends may at first seem like a great idea, there are many aspects of your relationship that you must first consider. Weighing the pros and cons of transitioning your relationship with a friend from friend to business partner is a major step. You do not want to put you friendship at risk, but there is an appropriate nature to enter the business world with your as your partner. You have the ability to develop a venture in which you both share passion and build a productive, yet fun, work environment. There are some points, though, that definitely are worth considering.
There are many positives that can result from going into business with a friend. The first is that if you are friends by a common industry that you are now entering, you will both bring a wealth of knowledge and passion to the business. If you and your buddy met and formed your friendship through being on a college golf team together, then there is definitely an opportunity to chase success in that industry. You both share passion for the game, but as different people, you both will be able to generate different ideas and allow the business to grow in a wholesome way.
When you enter business with a friend, you both know each other’s strengths and weaknesses. Structuring the company should not be hard, as one person could handle marketing and PR, while another takes on sales and distribution. If you both have the same skills, or can’t delegate who will take care of what, then maybe the fit is not right for a partnership and disbanding before starting at such an early stage could even save your friendship. If you can easily delegate the skills to each other, then your friendship and complementary skills have the possibility to lead to a successful business.
Another positive that comes from starting a business with a friend is that your friend will always be there for you, which is why you should be friends in the first place. If there is an urgent meeting that you need to prepare for, you need to trust and know that they will have your back. You should only be entering business with a friend who you know will be in it with the same dedication as you. In addition, business meetings will always be easy to come by. They are just a phone call away, and you will be able to accomplish much more, at such a faster pace.
Let’s face it, working with your friends on a venture that you are both passionate about is just plain fun. It won’t feel like work, but you will be able to accomplish so much without actually feeling like you are working. With that said, don’t forget that you must escape business, as well, and maintain you personal friendship.
Many cons can come from entering business with a friend. Time, dedication and money are all essential to consider. You both need to have a clear understanding of your expectations and where you want tot take the company. If one of you is working ten hours a day while the other is putting in a mere five, there is just no way to sustain that relationship.
Does one person want to build the company quickly and sell it, while the other wants to build a stable home from which they can enjoy the passion and success of the venture over a long period of time? While there are ways of working around these issues later as the venture grows, at least having an understanding in the beginning is a great way to avoid conflict later on.
Anytime that money enters a friendship, there can definitely be stress. If only one of you is investing, how do you delegate equity? The friend putting more money in is exposed to more risk, but you will still have to pull your own weight. Later on, what if one of you wants to bring in an investor and you have a disagreement over valuation and equity at that point? Making sure that you are both on the same page and having everything in writing is an essential way to make sure your friendship is on stable ground.
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