There are two conversations that are the mark of every true #BFF friendship. The first is ‘OMG, we are so funny, we should have our own TV show. I would watch that,’ and the second is, ‘Dude, I hate my boss too, why don’t we just go into business together’.
Right now, we are going to chat about the second one, because who doesn’t love being their own boss?
These ventures usually happen in one of two ways. The first comes from friends who are already working together and know that their partnership works well. Other partnerships happen when a friend who owns a small business brings a friend in, because they feel that their friend would benefit the business.
I know, you and your buddy are like this (appropriate hand gesture). After all, as friends you know each other’s thought processes and world views, working styles, strengths and weaknesses and each other’s preference of smooth vs chunky peanut butter. You already trust your ride or die, and working together is going to be hella’ fun and tension-free.
Now, don’t @ me, but before making the decision to go into business with a friend, be honest with yourself about the dynamics of your friendship. Let’s consider the negatives:
- What if one of you is used to being the alpha in the friendship, but the business relationship requires role reversal and the two of you cannot adjust?
- What if your friend’s strengths and weaknesses do not complement yours in the business context?
- What if there are behavioural traits that make him or her iffy as a business partner?
- What if he or she dabs?!
Just because you are dealing with a friend does not mean that you overlook your business partner requirements – you have to stay as selective as you would usually be.
After you have thought this through very carefully, you need to remember the words of the late and great King of Pop … ‘It’s human nature’. You need to accept that people and relationships change over time, no matter how long and deep the friendship is. This is not necessarily a bad thing for either the friendship or the business, these changes could make your friendship even stronger.
We are all mature adults here, yeah? A degree of formality in the form of contracts and other signed agreements is necessary to protect both parties and maintain those good vibes.
A whatevs attitude of ‘we’ll figure it out later’ could prove to be an epic fail for both the business and the friendship.
For instance, you and your friend should agree on and document the following:
- How the ownership of the business will be shared.
- The roles you will play in the business, including the time each of you will contribute.
- The steps to be followed in the event one of you decides to exit the business (e.g. giving your friend first option to buy you out).
- The stance on spouses and family members having partial ownership or working in the business.
- How to manage the business’ finances, especially keeping business assets and bank accounts separate from personal ones.
Stay woke peeps, stay woke.