We’re starting a new category on InvestorGeeks called “Entrepreneurship” because we believe that every investor is an entrepreneur at heart. Investing is the process of making money through the active trading and investing in appreciating assets, and this process of building assets is what a successful business is all about.
There is a chronic personality flaw that I see in so many entrepreneurs, that unnecessarily impedes their true success — resistance to having partners. I’ve had partners in the past, and I know the difficulties that can be faced by having a partner that is not picking up their fair share. But the secret to success in business is not to exclude people! Having partners is essential when you want to elevate your wealth.
I know the stories: you get a partner, everything is great for a while and then the other person slacks off, and you end up carrying almost all the work and still are forced to split the trappings 50/50. Or my other favorite: you get a partner and everything works out great for while. You’re both motivated and smart, and you share the work equally — but you both want to be in control.
You both have some hang-up on attaining this mystical position of power called “CEO”, and the balance of power becomes disrupted. As soon as there’s some kind disagreement about the future of the operation, one of you storms off swearing to never work with the other again, and the relationship dissolves.
These are some of the unfortunate realities in the life of the entrepreneurs, but I’m sorry to say I believe they are necessary evils for people who are just starting out. When there are no personal assets to build a company from the ground up, we have to be willing to give up some control to build collaboration with others, even at the risk of something going wrong.
Even if you’re not crazy about the idea of having partners, and there are many of you, I don’t imagine it to be required your entire life — just to get off the ground. When stuck in the rat race, few of us can escape quickly without the efforts of many.
Here are some rules I live by when building a partnership:
- Try to find two or three other like minded people; I find teams of 3 work best.
- Be willing to give new partners the benefit of the doubt, especially if don’t know them yet.
- Encourage communication and run all your important ideas by them.
- Be self-directed and take independent action day-to-day for the benefit of the project; expect the same from your partners.
- Be open and honest about how you feel — but do it constructively and for the benefit of the team.
- Try to keep the balance of power equal at all times. Ensure no one abuses their power.
- If you feel the balance of power is shifting either someone is taking too much or someone is participating too little, act quickly and assertively to resolve the problem.
- When it’s time to dissolve the partnership make sure you have everyone’s, not just your own, best interest at heart.
“But,” you may be asking, “why do I need partners? I can do everything myself!” I will not argue that point with you, since I used to find myself in that similar frame of mind, but the problem is that when you’re stuck in the rat race, or are very strapped by cash, time becomes a key concern. Either you have to work part-time to build your operation, or you have to quit and work rapidly to build critical mass, which is very labor intensive. You may be smart enough to handle every facet of the operation, but to put it mildly you simply do not have the time and sorry to say, there’s lot of equally smart people besides you! Don’t you want them to play on your team?
Let me share another secret with you; a lesson often ignored by many techies. There is often an economy of scale in brainpower when you get 2-4 people together to look at a problem. 2-4 people can figure out a problem a hell of a lot quicker and better than one. You each motivate yourself to think more clearly about your ideas, and you can rapidly bounce ideas off each other. To bridge the analogy, with partners you may be able to grow faster than by each of you individually.
If you have had problems with partners in the past, poor communication may have been to blame. Communication is absolutely critical to successful partnering. You must be willing to let down your guard and have both persons’ best interest in mind. Tell the others what you’re thinking, and be receptive to the thoughts of the other person. You are a team, and although compromise is sometimes necessary to get something accomplished, the benefits far outweigh the perceived cost.
I hope you’ll take a moment in your life now to think about where you’d like to go, and invite the smart, talented people whom you know to help you get to your goal, while offering to help them get to theirs. I’ve had good and bad experiences with partners, but making money in this world is to a large degree affected by our ability to deal with others — and in order to achieve your goals, having a partner can make all the difference.