Comments on: My dad said: “Never take on a business partner.”

By: Berni Jubb

Berni Jubb — Sun, 01 Nov 2020 02:12:44 +0000

Hey Dave, I thought you were going to use me as an example when I read this “Here’s an example of what not to do…A personal story about a partnership gone bad”.

I’d support most of the comments above even though the partnership I am referring to that you know well went quite quite bad. That partnership worked while it worked because my partner added a dimension I did not have – perhaps that is a selfish motivation but it worked and we together grew a successful business with lots of happy employees who also gained from the synergies of that partnership.

Like 2 marriages before it was not true love and when an opportunity came my partner was not what I had hoped for. A business pre-nup might have helped the mechanics of a breakup but like in marriage it would not have made the partnership any more resilient. It would most certainly have failed in either case. Great partnerships (as I now experience) and long term friendships as yours is operate on a higher set of principles. They do exist.

Berni
p.s. nice to see Bob Kelley still kicking around :-))

By: Mimi Grant

Mimi Grant — Wed, 28 Oct 2020 02:41:47 +0000

Dave, as always another great blog. And I must comment on Rich Sudek’s calling partnerships “a marriage without sex.” I’ve had three partnerships, two without sex, and one with. The one “with” started out as a business relationship, then became a real marriage – that’s lasted over 45 years, and shortly thereafter, a business partnership that’s lasted for nearly 44. In between, I met my first “other” partner when I purchased two Vector Graphic computers from him, while I was running an ad agency, in 1979: he was a Great Salesman. A few years later, following sharp declines in both of our businesses, he offered to take me under his real estate wing teaching me “everything he knew” about the business – if I’d use my advertising and marketing skills to help him. Six months later, with a brokers license in hand, Frank and I became formal partners in “All- American Properties” with three other successful brokers. Fast forward to 1994, five years after launching the Adaptive Business Leaders for Healthcare CEOs in SoCal, I partnered with John, a highly respected healthcare luminary in the Bay Area in launching ABL of Northern California – a Very Well-Papered contractual relationship, that lasted until he retired in 2006. Meanwhile, Bob Kelley and I have continued not only our marriage, but have contributed to developing each other’s areas of expertise. What’s made our marriage – and our partnership – work is that we have areas of mutual exclusivity and tremendous respect for each other’s contributions to our businesses and our lives.

By: Arthur Lipper

Arthur Lipper — Tue, 27 Oct 2020 22:23:23 +0000

Although most new enterprises require a Larry and a Barry, partners having different talents and areas of expertise, the advice is most easily reflected in a “Buy / Sell Agreement”. I make the recommendation of there always being a Buy/Sell agreement in any significant relationship where equity is involved.

By: Dave Berkus

Dave Berkus — Tue, 27 Oct 2020 22:18:05 +0000

In reply to Bob Kelley. Bob: An excellent way to look at various types of partnerships. And thanks for your personal story! Dave

By: Bob Kelley

Bob Kelley — Tue, 27 Oct 2020 20:07:28 +0000

As fate would have it, I’ve had many partnerships. So I wish to offer another couple of dimensions to your story. Different kinds of arrangements, and different levels of “researched trust”.

Some of my “partnerships” were “strategic (un-papered) partnerships”, some joint ventures, some “business arrangements” and some were turned into papered formal corporations.

Key was knowing which ring of my “rings of trust” to position the partner on, and then acting accordingly. At my outer ring were people whom I barely trusted, but saw a wide road to mutual benefit. At the inner ring were people whom I significantly trusted to pretty much drive on a “straight and narrow path”. Once I got a “good read” on people through appropriate due diligence, they generally followed their “expected driving styles” with 90+% accuracy.

Biggest personal benefit was the ability to retire at 42, and live comfortably thereafter. And that was more than a couple of decades ago.

By: Peter D.

Peter D. — Tue, 27 Oct 2020 17:47:41 +0000

I agree that one must choose there partners wisely. I have been in a consulting business with my partner for the past 21 years. We knew and worked with each other for 7 years before that, so we knew each other well and were friends. Our skills complement each other.

Although there were a few bumpy moments at the very beginning, it has been a fun and rewarding relationship. We are still close friends. We never had a written agreement and have never had a problem; we trust each other and have always demonstrated that we were each worthy of that trust. Perhaps it seems corny or old school, but it has worked for us (while I don’t disagree with any of the wise points above). I think we both realize that we’ve been very lucky to work together. Now, partnerships with other companies, yikes! That’s another story completely …

By: Jeff Koenig

Jeff Koenig — Tue, 27 Oct 2020 17:46:28 +0000

I see this prevailing wisdom often, but my experience is quite the opposite. Many partnership, lots of success. Partners don’t just add to your capability, but multiply it. So why do some seem to have bad experiences and others good ones? Well, you brought up the marriage example. Pick well and it’s wonderful. Pick poorly and not so much. Does that mean those who don’t pick well, advising the rest not to pick at all are right? Now then, *how* to pick well is a topic for my own blog.

By: Rennie Gabriel

Rennie Gabriel — Tue, 27 Oct 2020 16:38:42 +0000

Hi Dave. With the several partnerships I have had the most important thing I learned is that it takes two different personalities to create a successful business. One being the visionary and another being an execution master. Each business where I had a partner was more successful than any business I had on my own. And yes, there were issues of responsibility and as you suggested; an attorney drawn agreement is very important. It’s just like a prenuptial agreement before marriage.