Sharing your company with a new partner is a serious step in the development of your business. Such a big change can either be quite beneficial or it can bring new, unexpected problems to the table that you might struggle to solve.
This is why it’s crucial that you think through your every step and choose your new partner wisely. Hence, here are the most important things to consider when you decide to share your company with a new partner.
#1 Look for Someone Who Shares Your Vision
First and foremost, your new partner needs to be someone who shares your vision. It doesn’t necessarily need to be a person who has the exact same vision as yours, but your view on things and theirs needs to be at least somewhat similar. Moreover, you need to consider other things related to your vision, including your values, mission, interests, and plans.
Your vision will usually be reflected in your company’s vision statement, something your organization aspires to achieve. A powerful vision statement could define your entire brand. For example, Disney has become synonymous with spreading joy and happiness which is what their vision statement is all about.
Your company’s values and mission are directly connected to your vision and usually come as a trio. While your vision is about where you want to be, your mission is what you will be doing now to achieve your vision in the future. Likewise, your values are a kind of a code of ethics, something your company believes in, that defines the way your organization interacts with its customers and suppliers and conducts interactions within the company.
Your interests and plans for your company also matter. You should consider everything from your personal interests (e.g. which part of your company you are interested in the most) to the direction in which you want your company to develop. Once all of these views align with those of your potential partner, you can be sure that you found a person who speaks the same language as you do.
#2 Conduct A SWOT Analysis on Them and Yourself
The next step in your search for the right candidate is to conduct a SWOT analysis on your potential partner and yourself. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. Conducting a SWOT analysis will help you better understand whether you and your partner are compatible and will work well together.
Olive Newton, an editor of a reviews page and company culture writing expert, puts it this way, "If you have an IT company, you might be the leader in your field and be admired by dozens of your own competitors. However, being great at IT doesn’t mean you are good with HR management, for instance. This is why a partner can be so beneficial for you – they will make up for your weaknesses".
Here’s how to conduct a SWOT analysis on your potential partner:
- Set Your Objectives: In your case, the objective is to find a partner to share your company with who will be a good fit for you and your organization.
- Do Your Research: Start with your industry and market, then look inwards and analyze your company.
- Determine Strengths: Determine what your company is good at, which unique resources you possess, and what your competitors consider to be your strengths. Then, do the same thing for your potential partner.
- Identify Weaknesses: Identify what needs to be improved in your company, what your competitors do better than you, and which resources you lack. Now, consider your potential partner.
- List Opportunities: List the market opportunities your company has and how you can use your company’s strengths. Analyze your potential partner afterward.
- Consider Threats: Consider what your competition is currently doing, and which threats could hurt your company. Consider your potential partner.
- Assess Your Findings: Lastly, assess your findings. Look at the way your partner could help you improve your company and decide whether sharing your organization with them is worth it.
#3 Ensure That Your Skills and Resources Are Complementary
While your SWOT analysis will already give you a good idea about your company’s and your potential partner’s strengths, weaknesses, opportunities, and threats, you can look even further into your compatibility. The next step is to ensure that your skills and resources are complementary and that you can benefit from sharing your company with your new partner.
Keep in mind that skills and resources refer both to you particularly and to your team. There could be very skilled and experienced specialists working for you already – just as there could be such people working for your potential partner. Likewise, you or your partner could possess exclusive resources that are invaluable to the successful expansion and development of your company.
#4 Test Them in Times of Conflict
Now that you know every single piece of information about your partner, you probably think that you found the right person. However, there is one more thing you should do to understand whether you like the way they work and the way they handle difficult situations. Test them by creating a situation with conflict and see how they react and what they do.
Darrel Gardiner, an expert from a custom writing company, explains it this way, "The conflict you create doesn’t need to be external per se. For instance, it could be a conflict between staff members – or even a conflict between you and your potential partner. People react in different ways when they are in a stressful situation and need to think fast, but even if the conflict isn’t urgent, you can still see how they solve the problem in front of them".
#5 Get Feedback from Someone Experienced
Even once you are sure that you have found the right person to share your company with, you still need to have some caution. One final step is to get an outside perspective on the situation. A third party who doesn’t have an interest in siding with either one of you will be able to assess everything as accurately as possible and give you the feedback you need.
Moreover, try to find someone who has been in a situation like this before. An expert in your field can give you a great consultation, but another business owner who has shared a company with a partner could give you even more insight into the way you should be conducting everything.
#6 Work Through All the Essential Steps
Last but not least, once you have chosen your new partner, you will need to work through all the essential steps of sharing your company with them, including:
- Defining Roles: Discuss with your partner who will be performing which roles. This is crucial for the proper functioning of your company and for the success of your business. You and they will be at the top of your organization, so any misconduct could impact the whole company. Defining roles is also necessary before you start writing the agreement between you two because that document will be largely based on what you discuss.
- Signing Agreements: Find a seasoned attorney who will write a great operating agreement that will outline everything that happens with your company under any possible scenarios. This agreement should define even the smallest details (e.g. how the company handles partners who suddenly stop contributing). A detailed document like this needs to take into account all possible variables that could lead to risks for you and your company. Related: buy-sell agreement.
- Implementing in Practice: Once the agreement is signed, you can start implementing everything in practice. Introduce your partner (and their team, if necessary) to your company, set up the office space (or virtual space, if you work remotely), and so on. This is the stage where many issues can get exposed, but solving them shouldn’t be a big deal as long as everything in your agreement is upheld.
To sum up, sharing your company with your partner is definitely a complicated process which is why you need to take all the necessary precautions and choose your partner carefully. Use the tips from this article to help you find the best person for this role and successfully share your company with your new partner.
Nancy P. Howard has been working as a journalist at the online magazine in London for two years. She is also a professional writer in such topics as blogging, SEO and marketing.