If you are always bursting with new ideas, you may consider launching a startup at some point. Irrespective of the industry or your offering, you will definitely require partners. You may realize that instead of being on the lookout for associates, why not get into this project with your best friend?
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This article will let you have an insight into the pros and the cons of doing so. While creating a business plan, you may have constructed a worst-case scenario. So let’s start off by doing the same for when you wish to work with friends.
Running a business is not all fun
While working with a friend may sound like a good time, you still have a business to run. Habits and attitudes of your friend you may consider enjoyable on a personal level may not be ideal for the workplace or fit in with your future plans. Additionally, there is a thin line between being a carefree business and a careless one. Although creating a lively workenvironmentis important, you must not compromise on the amount and quality of work done.
If you are partnering with your friends, consider the financial implications on your relationship. Start-ups generally require the owners to pool in equity or pursue funding options and try to function with limited fiscal resources. Not only is this stressful also is not everyone’s cup of tea. Your friend may have grandiose ideas of owning elaborate office supplies, refreshments, or a large working space. This may lead to unfavorable situations.
While the aforementioned factors ring true, there is definitely some reason why some of the biggest companies in the world have been established by a group of friends. Harley Davidson, Facebook, and Hewlett-Packard are brands that have more than just success in common; these were all a product of friends getting together to create something new.
Familiarity with strengths and weaknesses
Owing to yourfriendship, it is assumed that you know what your friend’s plus and minus points are. This is extremely crucial since it allows you to strategically think of your respective roles and create a plan that allows for a smooth flow. It always helps which particular fields your friend would require help in, so you can either provide help yourself or know that some additional resources would be required going forward. The right combination of skills would help you encompass a wider area in terms of your start-up’s offerings.
The support factor
When starting out, you are most likely to be understaffed, underfunded, and overworked. At such times, having constant support at work is one of the greateststressrelievers. If your business partner is your friend, it eliminates the need of having to vent at a later time.
Along the course of your business’ ups and downs, you are both involved and this helps you communicate better, take democratic work decisions, avoid internal politics, and consequently, enhance the company’s functioning.
Having your friend there to support you acts as a motivating factor, helping you realize that only persistent determination will help achieve mutualgoals.
If you have decided that the pros outshine the cons and intend on getting into a business with your friend, here are a few guidelines to be kept in mind. This would help ensure that a smooth transition from friends to partners.
- Never include your personalfinanceinto the company’s working. Always maintain separate accounts to avoid tax complications.
- Ensure you are on the same page withrespectto the rules of the company, future goals, formalities and procedures to be followed, as well as the legality of your start-up
- Establishing ground rules and creating a set of defined work roles would help prevent conflict and foster goodwill
While some may prefer to keep their work and personal lives separate, you may choose to work with your friends since you both share common beliefs, a high degree of trust, and complement each other’s skills. At the end of the day, it comes down to what your priorities are and how comfortable you are in paving the way to a healthy work relationship.
(With inputs from Dishant Sanghvi, Marketing Captain and Jinay Shah, Operations Captain, PlayOSport)