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3 things to consider when going into business with a loved one

On Behalf of | Jan 9, 2024 | Business Law |

Going into business with a family member or friends has its advantages. For starters, you have an existing relationship – forming a business partnership can feel natural. Further, you understand each other’s strengths and weaknesses. Accordingly, you will know how to distribute responsibilities.

However, forming a business partnership with a loved one may affect your personal relationship. Thus, you need to be careful.

Here are three things to consider to protect your business and relationship.

Conflict resolution

When you and your loved one disagree about everyday matters, chances are you agree to disagree. But this may not work when you start a business together. You need to be on the same page on different matters to run the company successfully. For example, you need to agree on business goals, hiring practices, company policies, exit strategy and so on.

But you may not agree all the time. That’s why it’s crucial to have conflict resolution strategies – how will you handle matters when you can’t agree? 

Evaluation of performance

You and your future business partner should agree on how to evaluate each other’s performances. If you are comfortable providing feedback to each other, you can have regular meetings to do so. If not, a neutral third party can help you with assessments.

Personal vs. business life

Going to work every day with a loved one is fun. But you also have a business to run. So, how will you keep your personal and professional life separate? 

You and your business partner-to-be should decide what to discuss in the office and what to avoid. You should also agree on when to stop discussing the business and focus on personal issues.

A business partnership with a loved one or friend can be beneficial if approached from the right angle. Seek legal help to understand the steps to take.    

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