Choosing a business partner is a major decision that will have lasting consequences. If you make this decision wisely, your business has a great opportunity to grow and expand beyond your wildest dreams. However, if you make the wrong choice you might find yourself faced with a lot of unnecessary obstacles that prevent you from achieving your goals. If you're thinking about taking on a business partner, The Balance recommends the following steps.
Look for financial stability
In some cases, you may need your partner to contribute financially to your business. Even if this isn't an issue for you, it's still important for the person you choose to be financially stable. Mismanagement of personal finances usually signals irresponsibility or disorganization. These character traits will spell disaster for your business, especially if your partner is greatly involved in financial matters. Additionally, a poor financial standing will distract a person, which means that he or she won't be able to devote the necessary attention to business matters.
Steer clear of personal issues
Consider how much time and effort you put into building your business. Your partner will need to match this energy, which can be tough to accomplish when mired in personal issues. People claim they're able to leave personal matters at home where they belong, but this is usually easier said than done. A person in crisis, no matter what that crisis that might be, is less likely to be able to devote the time to help operate a business.
Have a contingency plan in place
While you want to go into the partnership with a positive perspective, you should also plan for the unexpected. That's why having everything in writing is a must at the outset of your partnership. Define the reasons why the partnership might be disbanded, as well as the circumstances that could cause you and your partner to break up. This can prevent costly litigation down the line if there is a misunderstanding between the two of you.