Being in a business partnership is difficult, it’s like being in a marriage. I was partnered with my brother-in-law. And if you’ve ever done business with family, then you already know how complex that can be.
The first real struggle that I encountered was about two and a half years into our partnership. We were going in different directions at the time and both of us had different desires. His vision was to go one way and mine was to go another route. We both had completely different strategies and couldn’t agree on a direction to go.
The family dynamic
First and foremost, the main problem that arises from partnering with family is emotion. In my case, I was thinking not only about my wife and what is right for our family, but also for my sister and her kids. Instead of thinking about what was right for the business, I was torn between what I should do for the family, and eventually, that started eating away at my relationship with my wife.
To put it simply, fear was driving the bus. The company wasn’t going anywhere, and the partnership couldn’t go on. That’s when I finally got the courage to sit down with my brother-in-law/partner and told him that either he needed to buy me out or vice versa.
Partnering with family seems like a great idea initially for entrepreneurs. It’s assumed that since both business partners care about each other and each other’s families, you will always be able to work things out. After all, family bonds should be strong enough to weather any disagreements, right?
While it’s great to have that positive outlook, that’s just not how things usually work out. That can largely be due to a lack of planning and foresight and not considering future disagreements. So when disagreements do occur, they can quickly escalate, leading to the worsening of a relationship/partnership rather than resolving issues.
The challenges of a partnership
That leads to what I learned about the challenges of partnerships with family. So many things can go wrong and there are too many variables to predict. And when something disrupts the harmony, that 50-50 partnership runs into trouble. It can be anything from:
- An offer or opportunity that can showcase the different directions each partner wants to go.
- When the business experiences a downturn or a partner makes a mistake.
- Arguments about who is doing more or who is more competent in one area of the business than another.
- One person wants to take the conservative route and the other wants to take risks to grow the business.
- Partners have different ideas about leadership for the company.
While these issues inevitably happen with any partnership, they can become especially emotional when family is involved. Once there is disharmony, it becomes difficult to leave families out of the decision-making process. This can lead to less communication and putting the blame on the other person.
In the end, I ended up buying out my partner, which isn’t something anyone wants to do. In order to get a fair deal, both parties need to lose a little for it to be an equitable split.
But it wasn’t all doom and gloom. In the end, I learned a lot about what it takes to have a successful partnership.