Should You Partner With a New Small Business?

Opportunities to partner with a new venture as a cofounder are open to investors and entrepreneurs of all levels. Answer these questions to determine if joining a fellow businessperson is right for you.

Do Your Values Align?

Partnering in a business is a marriage of sorts. Associates shouldn’t be identical, but successful partnerships have the same goals. Define your economic aspirations and mission for the enterprise and ensure it matches your prospective collaborator.

Look for core traits in a potential partner. Above all is honesty. If you had an accident and were incapacitated, could you trust the other person to live up to their end of the bargain? Implicit confidence is a necessity for a thriving alliance.

Find someone with infectious enthusiasm. It is hard to get investors and clients excited about the idea if there is no passion for what you offer. A reliable cofounder has a fervor that borders instability (without crossing that line). It takes a lot of work to get a new business off the ground, and you need to be sure no one is wasting time. In the beginning, founders must eat, sleep and breathe the business.

Flexibility is another important quality. While bright leaders love their ideas, a rational person cannot be obstinate. Inflexible teammates give lip service to desiring feedback and then resist without compromise. Expect to battle with words over strategy and implementation, but if a partner shows an unwillingness to bend in the face of reason, it’s best to excuse yourself from the partnership.

Do Your Skills Complement or Duplicate?

Two heads are better than one, but if you agree on everything, one of you is unnecessary. A great partner has strengths you lack and vice versa. Look for complementary abilities in the areas of finance and technical skills. A partner with high financial literacy can keep the company in the black through tough times and guide wise decisions on financing. Technical abilities are a must since continued competitiveness always involves innovation.

Is the Timing Right?

You could have the best idea in the world, but poor timing creates a recipe for failure. Don’t fall into the trap of looking at market size and thinking you can succeed by taking a minuscule piece. If competition is fierce, you’ll be shutting doors soon. Find industry and niche where the barrier to entry is low enough for intelligent yet inexperienced players to enter but high enough that you can provide value customers can’t easily find elsewhere.

When you analyze the complete picture, you can know whether embrace a partnership or respectfully decline.