It has been cited that the failure rate of business partnerships is as high as 80 percent -- remarkably higher than the average divorce rate. If things go south with a partnership, it is often even called a "business divorce." That phrase may sound a bit funny at first but the topic is all too serious.
As one of two co-founders of fast-paced boutique visual effects firm Kilt Studios, serving clients from the advertising world and Hollywood, I know firsthand what it takes to work to keep the scales balanced with two different personalities at the helm. My business partner Andy MacDonald brings a careful and measured management style to the team while I am a self-professed "bull in a china shop" type. We came together more than five years ago in the midst of what continues to be a tumultuous time in our industry and we have learned a lot along the way.
Here are five success factors that we believe are critical in forging lasting business partnerships in any industry:
1. Be open to the idea that the obvious choice doesn't always make the best partner.
It's not always your lifelong friend that makes the best business partner. We did have experience working together prior to founding Kilt Studios, but we didn't get along at first. In fact, people were surprised when we announced we were going into business together. But what we learned about each other as colleagues is that the work we produced together was well received, especially since we brought different skill sets to the table, and we developed a better working relationship.
2. Look for "dynamic tracking" as a type of talk therapy.
Having similar personalities isn't always a business benefit. While I am a "bull in a china shop," Andy tends to be more careful and cautious. We have a way of keeping one another on course and either reeling each other in or encouraging the other to push boundaries when needed. This always-on push and pull, which we call "dynamic tracking," has resulted in a healthier relationship for us and the best possible work product for our clients.
3. Make sure the passion matches.
|Just like in a marriage, if one partner is bringing more to the table than the other, issues emerge. This is not about doing things 50/50. This is more about both partners bringing 100 percent to the table, every day. Establishing a business is hard -- growing a business in a tumultuous industry is even harder. Imagine if your partner is just dipping their toe in the water while you've jumped in completely?
4. Seek respect first over friendship.
This gets tricky for many partnerships. It's not that friends can't be partners. It's simply that respect has to be the number one driver of the relationship. That way, the tough conversations can be had without the emotion. What happens if someone wants out? Or what if one of the partners dies? What do we do when we disagree? Having respect for one another first and foremost will help guide you through these early tough conversations and any differences of opinion.
5. Seal the deal in ink.
Last but certainly not least, take care to solidify your business partnership terms in writing. Handshake deals simply don't work. Having a well thought out, mutually agreeable contract provides a roadmap for any future forks in the road and shows the seriousness with which you run your business.
A business partnership does not have the luxury of a long engagement period but having a set list of criteria in your mind -- combined with solid mutual commitment -- can make the process as smooth as possible while also helping to guarantee success for you and your venture in the long run.