Having business partners is difficult, don’t let anyone ever tell you differently. One might say it’s like a marriage but without the good bits after dark!
So first things first, think long and hard about why you need a new business partner. Being mates is not a good reason. Nor, arguably, is because they have ‘done the time’.
But, if there is a real synergy, then by all means.
(It is probably important at this moment to clarify a little, given my apparent negativity about business partnerships. I have seen way more business partnerships fail, or at the least cause substantial heartache for all involved, then I have seen ones that worked. That is an unfortunate reality. And the other reality is that this occurs firstly, because they joined forces for the wrong reasons, not good business reasons, and secondly because when money is involved and as the amount of money grows, everyone becomes self-interested (naturally) and this is when tension arises.
Having said that, in my new business venture in the Early Learning and Child Care space, I have gone into business with two other partners. And, thus far, it is working absolutely fantastically well. Sure we still have our disagreements, but so far we have been able to work through them in a measured approach. The reason we can do this is that we complement each other so well, and we all know each brings their very own, unique skills and experience and expertise to the table, skills the others don’t have. And we know that as a collective we are more valuable together than separated.
So business partnership can and do absolutely work! Just make sure you enter into one for the right reasons. Duncan)
Having considered our warnings you decide to proceed with the entry of a new business partner, congrats and good luck. Now how is that achieved, and how is it achieved without incurring unnecessary and substantial tax consequences nor administrative headaches.
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