Do You Remember What Happened To Bonny And Clyde?
November 6, 2007
Neil Patel wrote a guest post on Shoemoney - Have a Business Partner? If Not, Go And Get One!
And whilst Neil made some great points, having a business partner isn’t for everyone. Bonny and Clyde were business partners, and look what happened to them.
So before you rush out and grab yourself a partner, consider the following points:
1) What are they bringing to the table? A combination of cash and business experience would be ideal.
2) What do they want in return? Anyone willing to fund a start up and give business advice will usually want a huge chunk of your business. Is it worth giving that percentage up - or is there another way you can raise the cash?
3) Maybe you’ve found someone who’s willing to join you in an equal partnership. They’ll put in an equal amount money and effort in return for an equal stake. But, the chances are, if this is your first business, you’re not going to find an experienced business owner who will do that. Think carefully about whether you need a business partner, or if you can just employ someone.
4) What happens if they stop pulling their weight and they still own half of the business? This happens a lot. And not everyone is willing to put in a lot more than they take out for a long time. For example I was in a partnership with someone who was willing to do very little whilst I worked round the clock. He also emptied the bank account, leaving the business strapped for cash.
I recently spoke to a woman who merged with someone in a similar business. But, it didn’t go as planned and she soon found herself working more hours while her new partner swanned off to play golf.
5) Then there is the trust issue. What do you know about your potential partner? Are they trustworthy? Believe me, there’s many things that could go wrong if they’re not. For example, I know a guy who wound doing a stint in prison because he was oblivious to the fact that his business partner was doing something fraudulent.
6) Do they share your vision for the company? They may say they do now, because they want a piece of the pie. But, what happens in a couple of years time when you want to expand, and they’ve reached a level they’re comfortable with?
7) What happens if they decide it isn’t for them? Will you be able to afford to buy them out? If not, you could find yourself in partnership with the type of person you’d usually cross the street to avoid.
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9 Responses to “Do You Remember What Happened To Bonny And Clyde?”
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One of the contractors we work with had a messy breakup with his partner recently. He’d known the guy since college, brought him in two years ago. Then something (we don’t know what) happened and suddenly the guy is gone and he doesn’t want to talk about it but seems depressed. I don’t know what happened there, but the friendship seems to be ruined. Fortunately, it didn’t ruin the business.
These are all excellent points.
And I have experienced all of them havng worked with 5 previous partners. I have had mild or extreme versions of each of these points.
Despite all that, they can sometimes work if you are lucky to find the right partners!
There is an excellent book by Ernesto Sirolli called Ripples From The Zambezi. In it, he talks about the trinity of disciplines that every business needs:
1) Ability to Market/Sell
2) Able to produce / deliver the product or service
3) Financial skills and management
And have passion for any one or two of these three. In his extensive research, he discovered that the sole entrepreneur is a myth.
An entrepreneur can usually be passionate and skilled enough in two of these areas, but nver had he found someone who could do all three successfully in one person.
Interestingly, he hadn’t discovered any successful instances of an individual who could be equally effective at Marketing/Selling and Finance. For whatever reason, any other combination of two from the three was usually found in successful entrepreneurs.
Since that book, I have read others which mirror this advice. That you should complete this trinity.
It is often possible to do this without taking on a partner - a great accountant you can really trust for example is a great way of filling the financial hole!
Equally though, if you can find one of more people you trust to fill the other areas, you will be able to share some of the burdens of being at the the top that isn;t always possible with an employee.
Interestingly Sirolli also discovered “hidden” entrepreneurs in his research. People who were very private, rarely known by the wider public, but who shared the same core characteristics of the well-known entrepreneurs.
He also discovered that even the most famous entrepreneurs actually had this trinity covered by a team of people or partners.
It’s just that the other members of their team - often sharing similar equity - contributed just as much to the success of an enterprise, even though they didn’t share the limelight equally.
I agree these are excellent points.
Several months ago I was approached by someone to join them in an online business venture since I did not “know” them all that well I decided against it. Seeing the difficulties that there partner has experienced I’m so happy I did not agree to it.
This post has been Stumbled.
That’s Bonnie, not Bonny.
Ian - that is interesting that he knew none who had a passion for sales and marketing and also financial skills/management. I wonder if that’s because people struggle with having to shift between left brain and right brain tasks?
Opal - Thanks. It sounds like you made the right decision.
Gary - thanks but I think I’ll leave it. I doubt whether anyone will sue me for spelling the name of a fictional character wrongly.
It is really challenging to find a perfect partner. More difficult than finding a good husband, I have to say.
I think a partner with a lot of cash is not a bad thing. Because they would like the business to succeed, when they commit the money. Nothing is worse than having an uncommitted partner. And I do not think I have to be so greedy to keep so much equity first. I have to first succeed. Once I succeed, then, I will have gotten my own cash to do more. And then, again. I think entrepreneurs need to be ready to try 10 times, and should not expect to get everything right in the first time.
In business, I think we have to ask ourselves, why we feel we want/need a business partner. Is it for the extra capital, or is it for the expertise the other person brings to the table? Or…, is it because we don’t think we can make it on our own (lack of self confidence?)
Partnerships are very much like marriages, with children. There may be fights about money, fights about equality (who takes out the trash), fights about how to handle the products/employees (kids), fights about how the business should be run (discipline), fights about how many hours each person should put in each day (bedtime), and fights because the a spouse gets involved (mother-in-laws),
If these issues aren’t addressed in an iron clad contract (marriage license), it will spell disaster (divorce).
I have to say I like the way how Barbara presented this ;)….
By the way, seems like Cath got caught in RL for good…i kinda miss her presence and the new posts.
Barbara good points. I confess - I hadn’t even thought about the spouses getting involved bit. Now, I have had employees spouses interfere when they don’t like certain terms - usually overtime! But, a partners spouse interfering would be a complete nightmare.
Astrit - where on earth is RL? Don’t worry - I am back. Have been awfully poorly for a few weeks and struggled to shake it off. I guess I’m feeling my age. But, not to worry, almost completely better now. Thanks for missing me.