Starting a business partnership is like getting married. In the beginning both people are happy, excited and in love with their great business ideal that is going to make them millions! The happy business partners are like newlyweds, acting like they are soul mates who are destined to be together forever. Both are on their best behavior, helpful, and complimentary to each other. They have become so connected over the ideal of success that they finish each others sentences.
Unfortunately, many people pick their business partners like they pick their spouses, on superficial qualities. They do not spend the time or make the effort to check the other person out.
When considering a general partnership you should have crystal clarity about character, personality, skills, talents, experience, and established business contacts. Find out about his or her reputation among his or her peers – people talk and it is easy to find out if someone has a questionable past.
A general partnership is when 2 or more people form a business together and each person shares unlimited liability for the debts and obligations of the business. Partners are essentially investing their credit, lively hood, time, energy and resources in part, in someone else.
Even if you know the other person well, or so you think, conduct a thorough background check on him or her:
- Pull his or her personal and business credit
- Check references – past employers, past business partners, customers, and employees
- Verify assets and the source of his or her investment into the business
- Review his or her resume looking for education, experience, and other credentials