Approaching partnerships
And the key to making them work.
Founder inspiration
I went to another Founders Dinner here in Valencia Friday night. I was invited to the group by a guy I met in Lisbon in October at MicroConf. Each time, the group is a little different than the one before.
I went to another Founders Dinner here in Valencia on Friday night. I was invited to the group by a guy I met in Lisbon in October at MicroConf. Each time, the group is a little different than the one before.
Last night there were six of us, each from a different country: Italy, Serbia, Sweden, Ireland, a Canadian who now lives in Russia, and myself.
These dinners are always so fun and inspiring. Everyone comes from different backgrounds, yet we all have so much in common. I always find their various businesses interesting.
The guy from Serbia runs a company that generates clothing labels for some of the biggest fashion brands in the world and has sat across the table from their CEOs. Another guy created a popular software platform for restaurants. Another recently sold a freelancer marketplace, and so on. I always love hearing how people from all parts of the world and all walks of life are finding their way as entrepreneurs.
The key to healthy partnerships
I got a message from someone the other day asking:
“In a 50/50 business partnership, how do you ensure the other person is doing the same amount of work as you?”
I responded with one word: "Trust."
When I grew my last app, Castanet, I was a solo founder.
The obvious upside is that I had 100% control and 100% of the equity and profit. But I also had 100% of the work and pressure.
Partnerships can be great to help balance out strengths and weaknesses, stay motivated and inspired, and feel less alone.
However, partnerships don't come without their challenges.
I currently have two great co-founders: Alex on Aware, and Jan on ViralBox.
When I think about what makes these partnerships work, I think about the same things that it takes to make a marriage work: trust and good communication.
In a partnership, nobody wants to be tracking hours and score-keeping.
If you find yourself micro-monitoring your partner's hours, you're in for a tough road. Expect to pull more weight sometimes, and expect your partner to pull more weight other times. As long as the balance isn't heavily out of whack, you're doing just fine.
It's also important to recognize that value provided by each partner isn't always strictly related to time spent. For example, a friend started a business in the music industry, and recently brought on a very famous musician as a 50/50 partner due to his considerable influence and star power, even though he isn't much involved in the day-to-day.
What we're striving for is a general feeling of balance, trust, and respect over time.
About trust:
The strongest trust comes from knowing somebody over time.
Trust can also come from looking at a person's history. If they have a history of bad business relationships, that's a potential red flag. Yet, if they are on good terms with previous business partners, that's a great sign.
If you don't know the person well, do a trial run. Give yourselves a specified time period to work with each other and see how it feels. Then have a candid conversation about moving forward (or not).
About formalities:
I've never created an official partnership agreement with anybody aside from business entity filings that define the ownership percentages. And I've only ever done this after the business has reached a point of needing to file taxes (generating real income).
Instead, I opt for casual handshakes and early and frequent communication about expectations, goals and how things are feeling overall.
Relationship maintenance:
With email, Slack, Discord, and all the communication tools available, it's easy to feel like there's no need for face-to-face meetings/calls, but I have found that a recurring weekly call is invaluable. Even if there's not much that hasn't already been communicated that week, it's critical for maintaining a healthy partnership.
Olly and Wilson, of Senja, recently had troubles in their partnership that they made public:
Today we were going to announce we raised a 6-figure investment from TinySeed
Instead my relationship with my co-founder @euboid has almost completely broken down
And we had to pull out of the investment
We’re unable to work together due to different work and communication… twitter.com/i/web/status/1…
Fortunately, through openness and communication, they were able to sort it out and continue thriving.
Conflict can often be repaired if all parties are willing to communicate productively and own their share of the issue. But it's much easier to communicate early and often, even if it's not always
When you’re ready:
Monthly coaching: My 1:1 coaching via chat has been more popular than expected so I’ve closed them to new signups before they become more than I can keep up with. I have replaced those with new coaching options.
1:1 clarity call: Wherever you are on your bootstrapping journey, chances are I've been there. I know the struggles and challenges and am here to help through a 1:1 clarity call.
Tools and resources: A complete list of the tools and resources I use to run my business, and some books that have helped me along the way.
Til next week!
Mac