Picking the right partner is probably one of the hardest things to do in business. A good partner is like a good tool, it can allow you to get more done than you could on your own. In my experience, the right person can more bring more to a situation than two individuals could accomplish working alone.
Of course, the wrong partner can be a nightmare and cost you way more than you could lose on your own.
It’s hard to pick a good partner. Like dating, everything always looks wonderful in the beginning. There is excitement and energy, everyone is on their best behaviour, giving everything they have to the relationship. This period, unfortunately, often lasts several months…just long enough so that things get difficult, and expensive, to fix if things go wrong.
The stats say 50% of marriages end in divorce, I suspect the statistics for business partnerships ending id much higher.
Of course, many people say nothing tests a marriage more than your first renovation. So, having a partner go through some renovations with you may, in fact, be a good way to vet the possibility of a lasting relationship.
Things to look for in a Partner
Are you the same, but different?
Many people say opposites attract, others think that their mirror image make the best partners. The truth is, neither does. If you are polar opposites, you’ll drive each other nuts (think an OCD neat freak won’t kill a lazy slob?), and most people get really annoyed at people when they see their own flaws in the other person.
The best partners are ones who are similar enough in their attitudes to get along, yet have complimentary skills or interests that make up for the weaknesses of the other. These people can learn from one another, yet also cover for each other.
Another way to look at this idea is do you have a similar work ethic? It doesn’t matter if one of you is a night owl and the other an early riser, as long as you both work hard. In Fact, more can be accomplished as you’d start early, overlap to handle harder stuff, then continue on into the late hours.
Are you close in age?
This is more important than many people think. People who are at different life stages have different goals. If one partner is closer to retirement, and the other is just starting out on a career, the long term goals are going to be very different. The risk tolerance is going to be very different. The lifestyle you lead is going to be very different. These differences are magnified in real estate because it’s usually not a short term deal. In the case of flipping, it may not seem apparent, but the younger guy may come to resent the stodgy old fart. Design ideas may also be significantly different.
Do you have similar tastes?
If you are working on a flip, you better agree on what you consider to be trendy and hip. it also helps if you like the same types of food, since many a detail will be handled over lunch meetings.
Can you both see beyond the obvious?
When it comes to work, it’s easy to see who is doing more “labour”, but can you look beyond that to see what the other person brings to the table? Are there meetings behind the scenes? More money brought in? More experience? more efficient work? etc. I’ve rarely found two people who ever agreed they did equal work, both of them usually feel they are contributing more, the trick is to see that the other is contributing a significant amount, enough to say they are pulling their weight. Chances are, they are doing a lot more than you give them credit for anyway, but few people would ever believe that.
Do you trust them?
Without trust, you don’t have much. I’ve seen many businesses where the owners don’t trust their staff. Now, I’ve been burnt in the past, just like everyone, but if you don’t trust others, then you may as well not work with anyone because you’ll be spending all your time watching and micromanaging to the point where nothing will ever get done. When you are dating someone, if you can’t trust them, you won’t have a marriage. All the lawyers and agreements in the world can’t protect you from this.
Are you in it for the money?
Nothing brings out the worst in people more than money. I’ve seen millionaires go to court and squabble over less money than the spend on a lunch. If the only thing bringing you together is the thought of riches, then you’re probably headed for failure. Working with someone else is about expanding your abilities, creating something new, pushing your boundaries, and so much more…the money usually comes along with it, but not always and that leads to issues. If you can’t find any other value in the relationship, you’re bound for failure.
Are you equals?
Nothing worse than having one partner richer than the other, or more skilled than the other. These partnerships usually devolve into a sudo-employee-employer relationship. Partnerships are about being equal. Few people can separate their feelings as it is, it’s even worse if they’ve got some reason to feel they are superior to the other.
Now, this list is far from complete, but they are a few of the things I’ve learned to look for when working with people. I suggest, like one should in dating, to start off slow. Don’t get too committed until the “honeymoon period” had worn off. You really won’t know how your relationship will work longterm until you’ve faced some real adversity. Remember, having someone along for the ride can make adversity easier to handle if you let it, but it can also make it a lot worse if you turn on each other in times of crisis.
Lesson: Be careful when choosing a partner, don’t rush in during the excitement phase. Partnerships, like real estate is a long term road to profits and success.