I have met hundreds of owners that are in partnerships, and many that have been through the pain of exiting a partner out of a business. When you have that conversation about how the exit came to be and what it cost the organization, you can see the pain on the owner’s face. You can see the agony that they went through for months based on the decision they made many years earlier with less information than they needed to make that decision.
We tell our kids not to get married without really knowing their prospective spouse, but in business we see people running into relationships after just meeting each other. You seem like a great person and you compliment me in so many ways, until there comes a time when they don’t, and that is a very painful time.
Business partnerships are extremely challenging when they work, but the challenges of a bad partnership can kill even the healthiest of businesses. If you are at the point of considering adding an equity partner in your business, think twice. Do you really know this person as well as you need to and do you really want to get married? Partnership Pain is no fun, so do everything you can to avoid it.
