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Pre-marriage plannning for people going into Business Partnership

           

May 6, 2021 / fbcadmin

Kerrie Sheaves
Foundational Business Consulting
0404493488

Business Partnership

Pre-marriage planning for people going into Business Partnership

Going into a business partnership (or a joint venture), even if you’re an experienced business owner, is just like getting married. It shouldn’t be rushed into or taken lightly.

Before you go into partnership you need to know what you’re really signing on for.

Most business ventures, with more than one director or partnerships, begin with a couple of optimistic people who can see a great business opportunity. An opportunity that can only, or better, be fully seized through collaboration or partnership with another party.

Partnerships can be great, and they can be really, really bad. When partners fall out, the ownership, control, and even survival of their company are threatened. Unfortunately most partnerships end in painful, expensive and messy divorces.

That’s why taking a breath and doing some Pre-Marriage planning for your Business Partnership is essential.

What does Pre-Marriage Planning for Business Partnerships involve?

At Foundational Business we run Pre-Marriage Planning for Business Partnership sessions which includes both (all) parties sitting at the table and talking. We work through;

  • How the business will operate,
  • What the expectations of each person are
  • Their role in the business model
  • The financial return and input expectations of each person.

That includes discussing scenarios, potential risks, ownership of assets, intellectual property, and what role each person will play now and in the future as the business grows.

Pre-Marriage sessions help build alignment of potential partners, and new partners, by facilitating practical and tactical discussions before crisis hits.

These discussions can help identify:

  • inaccurate assumptions,
  • gaps in capability,
  • unidentified expectations and
  • personal goals that are incompatible or need to be factored into the operating model of the business, before trouble starts.

When should you do a Pre-Marriage Planning session for a Business Partnership?

Ideally before you begin a business partnership. Before you sign that shareholder agreement or register the company. Why? Because your company ownership structure depends on mitigating risks for the directors. And there’s lots of risk in partnering that needs to be covered off.

If you can spend a little time identifying these elements before your Accountant and Solicitor activate your company, start purchasing business names & web domains, and draft your shareholder/partnership agreement, it’ll save a lot of time and money. If you have the wrong contracts and structures you’ll be exposed to danger. Then you’ll have to bear the expense of redoing those processes to ensure that each partner in the business and the business itself is protected and functional.

If you’re already further down the track and the business has started, it’s ok it’s never too late.

If you and your business partners can address the key issues that need to be clarified before a problem occurs and relationships start to really breakdown, you can proactively implement changes.  That will ensure the current and future stability and success of the business and the happiness of its owners.

If you’ve noticed a few little things that you and your business partner don’t seem to be aligned on. Or there’s some situations that are starting to bother you in your working relationship, don’t let it fester. Get a together and do a Post-Marriage version of the Business Partnership Planning session with us.

If you’d like to find out more about our Pre-Marriage Planning session for a Business Partnerships, call us today on 1300 765 249.

 

Photo by Chris Liverani on Unsplash

Call us to find out more today!

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