While it may seem pretty logical to start a business with a close friend, sometimes the stress and strain that comes with it can very easily be under-estimated.
In this article we will discuss a little about the advantages and disadvantages of partnering up with friends when starting your business. So let’s start with the pros.
Working with a friend you have known for a while is probably safer than indulging with someone you have just met at an event and have very little knowledge of their background.
To some level, you know their personality a little more than just the surface level and you have an idea of what gets them going.
Probably, you have also seen the satisfactory, the unsatisfactory, and the ugliest bits they have. This means if you choose them, then you know what you are “in bed” with.
With business being so unpredictable, it’s best to embark on it with very little unknowns.
The fact that you are friends already means there are several fundamental values and beliefs that you share which can be an asset when starting a business together.
Personal differences may occur among you and you may have opinions that differ concerning certain issues and approaches but most likely, you share the same core values. With this considered, it would be easier to smoothen out eventual conflicts that may arise.
Others may , however, argue that having different core values and social backgrounds may in itself be a strength when starting a business with someone who is not essentially, your friend.
Do you have a friend that you have known so long and become so close that you can read each other’s thoughts?
The fact that you know each other so well can allow you to dissect important and difficult matters at length and with honesty. This can lead to more efficient and quick decision making.
Having known each other for a while, you might have an idea of their fortes and their limitations. With this knowledge, you are going to allocate, appropriately, tasks or responsibilities across the business.
Ideally, it would be much easier to utilise one’s strengths if you already do understand the person, and with the knowledge of their weaknesses, you can be proactive in ensuring nothing falls apart on account of these known weaknesses.
Looking at our lives, you will realize that we spend more than 40% of it at work. If so, why not work with people you get along with pretty good? Starting a company with a friend will give you a rare chance to work with the person you want to work with. With them, you can discuss not only business but share interests and hobbies also.
But What are the cons?
Honesty can be difficult
As easy as it may be to communicate with a friend during good times, it may be hard to be frank when times get hard.
One may tend to consider their friend’s feelings more, especially if they are sensitive. Naturally, we would prefer not to hurt our friends - notwithstanding what would constitute ‘hurting’. Depending on one’s personality type, it may be difficult to be honest with a friend when giving negative feedback.
In most cases where you value your friendship more than your business, you could let those errors slip in a bid to avoid a possibly messy confrontation with your friend.
But realising the possibility of this happening should allow you to prepare a structured feedback process that will not let the friendship come in the way of running the business efficiently.
Who is the boss?
If the leadership structure of the business is not explicitly stated, then it is possible that some friction may occur between friends on who is in charge.
Even if shares of the company are divided equally, occasionally, moments may arise where one feels that they are working to bring in more than the partner and so deserves a bigger chunk.
Without this being addressed, bigger issues may arise like lack of direction and mistrust. The ultimate consequence could be the eventual failure of the company.
You may lose your friendship and mutual friends as well if things go south
It is possible that you may lose your friend in the event of a fallout, especially if business goes south. This may be because of differences in ideologies or insensitivity or literally anything else.
The fallout may spillover to the mutual friends you share as the rift grows and they are forced to take sides.
As much as losing mutual friends should not really affect your business, it is something to have in mind.
So What are the factors you should look at?
Having seen both sides of the coin, it is time to ask what you should look at before engaging a friend in starting a business.
Do you have the same vision and values?
Understanding what inspires and motivates you and your friend is very important. You have to ensure that you align from the beginning.
Having different visions will likely bring about tension in the near future.
It is equally important to have the same values just as it is to have the same vision.
Making strategic choices may be difficult when both of you are fueled by different things.
How do you smoothen your disagreements?
If you are the boss, you are tasked with making the hard decisions. With this responsibility, you need to have honest conversations with your partners and employees. Even if it is your friend, you have to have these conversations with them. Without being able to do this, efficiency takes a hit.
Do your skill sets complement each other?
Imagine both of you being so good at marketing but not so good at product development. You would likely need to hire product developers to cover that skills gap.
As much as you should share a sense of direction, vision and values, your skills should complement each other - or at least, acknowledge what skills are lacking and plan how to fix that.
A great example is that of Steve Jobs and his Apple Inc. co-founder Steve Wozniak. Jobs was a talented salesman and Wozniak a product developer.
Are you okay with losing your friendship for the business?
Would it be worth it to lose your friend(s) for you to make a profit? This question is a tough one and one that requires deep thought before starting a venture with a friend.
For some, they will value their friendship over the profits and for some, it may be easier to go for profit and forego friendship.
It is definitely not that clear-cut, and in fact, if you are successful, who better to share the spoils with than your bosom buddies?
In business, there is no defined script that defines the surefire path that should be taken.
There are stories of guys who went solo and guys who partnered up with friends, others partnered with complete strangers to create very successful companies.
Whatever decision you make, ensure that you have considered all the factors, created the right structures and get to work. Different experiences, some first hand and others told in story, have made people choose whether to mix friendship with business or not.
This subject sparks quite an arguable debate with some arguing that they found the secret to mixing friendship with business while others strongly feel that mixing friends with business should be strictly a no go zone!
Now tell us, would you start a business with a friend, or have you already started one with a friend? If you have, how is the experience?