Partnerships

[220/221]

I am th exception to the rule. My partner started about 15 years ago when I was 40 and he was an exceptional 21 year old. We were able to bootstrap the business and get it off the ground with very little capital but a LOT of hours.

The plan was, I take care of him in the beginning and he takes care of me later on. I feel that I made out really well on the deal. He feels that he made out well. It's a classic win/win.

The secret is doing what you do best and let you partner do the same.

Typical wisdom as the business grew would have left him in the field and me in the office. I KNEW my shortcomings and I KNEW my place was in the field.

He was an EXCELLENT mechanic, one of the best I've ever worked with but his real strength was administrative. He estimated higher than I did, he loves meeting and talking with people and he follows thru on things that I would put in a pile somewhere.

I don't know if it is one in a thousand or one in a million but it CAN work.....occaisionally.



Also, we had NO agreement of any kind for a few years. I haven't seen the checkbook in 14 years. He was the one that took the necessary steps to incorporate and keep everything proper, insured, legal etc. When he hands me something to sign, I sign it. I would (and do) trust him with my life.

This may be a one in ten million thing


Another thing to be aware of. Since the movie "American Beauty" came out, you have to be careful to introduce your partner as your "business" partner unless you want people to think it's your life partner.

 

[active1]

Think of what the situation would be like if your both busy working projects, the bank account is low, not much cash expected in the near fucture, more money owed out than what the biz has, and both partners need money for them and their familes. Who gets that last $? Would one partner take service work and materials from the biz to get paid cash for his family?

Which partner works more hours?
Which partner works harder?

What keeps a partner from making large purchases that your responcable for? Even if you had no money in the bank the partner can sign contracts that your responcable for thousands. An example is advertising. They could sign you up for full a page ad in every phone book, Blue Book, newspaper, flier, etc. thinking you'll have so much work paying 5K-10K a month is easy. How about cell phones with contracts for everyone and their family? Maybe he orders 5K of materials just to have an invantory on hand? If the partner is a salesman easy target then don't let him answer the phone. Every day I get calls about insurance deals, internet advertising, advertising in phone books that don't exist, charities, postage meters, pens with a company logo, telephone contracts, and mail order materials that are junk.

 

[charlie tuna]

220/221,
congrats on your success! it's not impossible, and i have worked for companies with partners--one which had six brothers as partners! as you explained, it usually works when the partners have different specialties to contribute to the business. one contractor i worked for split the town in half and they each ran like two total businesses out of one shop -- they got along and were successful!
there have been mentioned contacting an accountant for advice, i strongly advise against this. accountants know numbers and tax laws and very little about running the actual business. i used to laugh at some of the suggestions my accountant had -- and i would tell him "burnie, you'ld have be bankrupt in six months!". and he was a good accountant!

the biggest problem is relatives -- it's normal for family members to "take sides" --and without the partners even having problem! "my husband works too hard"--- "my son doesn't have a vacation" --- " he has a newer truck"!!!

the silent partner thing sounds great -- you do your normal thing and let him do his and go from there--go slow--step by step.............