New Partnerships: Finding the right person to lead your company

Businesses benefit from the potential diversity of knowledge, experience and resources that multiple owners bring to an enterprise.

However, in accessing these resources, companies need to develop an organizational structure that assigns areas of responsibility according to each partners or employees strengths, expertise and commitment to the company’s goals.

Each partner needs to know what their associates bring to the venture and collectively the team needs to decide how to best use those resources. This type of predefined structure makes a company flexible, focused and stable.

Leadership

Most ventures start with a limited amount of capital and manpower, which means owners need to take responsibility for aspects of the business they are not competent or interested in overseeing.

For some people, it becomes an all or nothing proposal. Consequently, they refuse to entrust somebody else with any responsibilities, because of their compulsion to retain control or because of pride.

The business becomes an extension of their personality and self-image. They refuse to accept advice in their personal life and by extension are unlikely to accept it on behalf of the business.

Partners need to be aware of these traits, and act accordingly. They need to accept this management scenario, find a tolerable compromise or walk away.

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The Importance of a Partnership Agreement

Depending on the nature of the venture, starting a viable business can be as straightforward as coming up with an idea, using some ingenuity, and deciding on a catchy domain name.

In the past, starting a business meant entrepreneurs needed access to large amounts of capital. Now, the internet is making access to production, distribution, advertising and marketing services inexpensive and accessible to anyone.

Without a barrier to entry, entrepreneurs need not fear the financial ruin that once accompanied the failure of a business.

However, people tend to forget the other potential risks involved in starting any business venture. These include ownership of patents or intellectual property, the division of ownership or procedures to dissolve the company.

Contracts minimize the inherent risk involved in a new enterprise by forcing partners to outline their expectations and give some forethought to possible complications.

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