Is it wise to go into business with a friend?
Is it Wise to Go Into Business with a Friend?
You want to start a business, but the thought of this big move has emotions running high, panic ensues, and the overwhelm kicks in. It just sounds easier if you take this leap with a friend right? However, the looming question you are probably asking yourself is…is it wise to go into business with a friend? Shannon Russell, Career Transition Coach and Host of the Second Act Success Career Podcast, breaks down the info you need to know before you take the leap into business with your best friend.
Your friend may share the same passion for finding a purpose in life through building something of your own. She may want to be her own boss just like you. So the idea of forming this business relationship on top of your friendship, just makes sense right? Well, it doesn’t always end up as perfectly as it may seem. We all can’t be the next Ben & Jerry, you know?
As a woman, it’s wise to be cautious when deciding to go into business with a friend or opting to build your biz solo. Let’s dive into the pros and cons together.
Why Women Want To Start Businesses with Friends
Women often choose to start a business with friends because they feel comfortable and it’s much easier to start something scary when you’re doing it with someone else. Starting a business is a big step with many moving parts, so taking this on together may seem less stressful. Plus, starting a business with a friend can create a sense of shared responsibility and commitment to the business’s success. You’re taking on the world together so to speak.
However, launching and growing a business is like raising a baby. You are giving birth to this new idea, creating it as you go, getting the word out, helping it grow, and changing ideas and goals along the way. Don’t be fooled into thinking making all of these decisions with a friend will make them easier, in fact it can sometimes be harder to tell a friend no if you disagree, than to tell someone you may not care about no. You will need to have a solid business plan in place that you agree on, and a clear understanding of each other’s roles and responsibilities before you begin. Setting yourself up for success must start early, so you know who is in charge of what in all aspects of the business from operations to marketing to financials,
Advantages of Going Into Business with a Friend
Let’s talk about the advantages of starting a business with a friend. First off, as friends you know each other’s strengths and weaknesses. You can leverage each other’s skills to grow the business by designating tasks to the person who can tackle it best. Additionally, starting a business with a friend can help you reduce your startup costs. You can share the expenses and pool your resources to make the business successful. Just be sure to know how to divvy up those profits at the end of the day in a way that is fair. The money aspect of the business can be a tricky path to walk down with a friend, so it must be handled with much attention early on.
Another advantage is that you have someone to share the workload with, and having a partner can help you manage daily tasks and reduce stress. It truly is a partnership, so take advantage of turning your friendship into that of business besties from the get go. Be crystal clear on who does what and make sure the tasks are evenly dispersed. Also, make sure you have clarity between your work roles, whether it’s a Google doc you share or daily/weekly check-ins. Make this new relationship you’re forming together fun for you both, but delegating responsibilities and minimizing stress.
Most importantly, starting a business with a friend can help you build a strong support system. You have someone to bounce ideas off, share successes and failures, and motivate each other to keep going. If done right, you will be destined for success because you are working together with someone you trust, working on a project you both believe in. It’s a win-win!
Disadvantages of Going Into Business with a Friend
All right, now it’s time to discuss some disadvantages of starting a business with a friend. The number one disadvantage being that working together to form a business may create strain on your relationship. We all know that business can bring out the worst in people at times, and the same goes with friends. Business decisions can be challenging, and disagreements can arise, leading to conflicts. Think of these potential pop-up issues before delving into business together. Have a healthy conversation about the what-ifs ahead of time so you can get in front of any issues to make a plan for how to handle them IF they arise. You don’t want a failed business to affect your friendship, or a failed friendship to affect your business.
Another disadvantage to bring to light is that it can sometimes be challenging to separate your personal and professional lives. The same can happen in a family-run business. When you are working, you may bring up personal issues, or when you’re outside of work, business issues may enter the conversation. It’s super common, but it’s how you two choose to handle these instances that will decide if you can grow with the business together or not. Discuss how to separate personal from business early on in this joint venture, so that you can enjoy your relationships both personally and professionally.
How To Decide If You Should Go For It Or Forget It
It’s time to decide if you should in fact go into business with a friend. Before making this decision, ask yourself some crucial questions. First, do you have complementary skills and strengths? Do you share the same vision for the business? Do you hold the same values when it comes to clients or customers? Are you ready to hold each other accountable when the hard times hit? Are you willing to support each other through the ups and downs, the successes and the failures?
Make sure you are on the same page with your friend. It is essential to have an honest conversation about your expectations, long-term goals, time commitment, roles, and responsibilities. You should have a clear outline of what you each bring to the table to truly build a business that you will both love and be devoted to growing.
Moreover, it’s crucial to consider the impact of the business’s success or failure on your friendship. Are you prepared to handle conflicts and disagreements without damaging your friendship? Agree to go this together 100% and agree to disagree when the difficult times trickle in. Know as you move forward that it’s a 50/50 business and you must each give your all to make it succeed. Together you will!
Setting Up Shop Together
Establishing clear roles and responsibilities is crucial when starting a business with a friend. Define each person’s role, what each person is responsible for, and how decisions will be made for the business. This will help to prevent conflicts and misunderstandings down the line.
Set up systems early on that will lead to success. Select a project management tool to set up your work flows, to-do lists, and on-going projects. This may be online platforms like Asana, Trello, or Notion, or it can be docs you set up in your Google Drive to share. Regardless, have all of your necessary systems set up in the beginning and make sure you can keep track of what you and the other person is doing on any given day. This will help you keep track of your business and it will create visibility between the two business partners.
Remember, communication is key is success! Establish and agree on how and when to communicate, how often to hold meetings, and how to handle conflicts. The more you talk the better. Business is work, but there are ways to make it fun too. Always try to bring the fun into focus, and you will be reminded of why you wanted to go on this adventure with a friend.
Also, do not forget to document everything in writing and have a signed agreement. No one wants to talk about the legal side of doing business with a friend, but it really is one of the most important parts of kicking this business partnership off right. These legal documents will help to protect both your business and your friendship.
Maintain a Healthy & Happy Friendship and Business Partnership
We have listed the advantages and disadvantages of going into business with a friend, but the truth is it really is possible to maintain a healthy friendship while growing a successful business. If this is a priority for you both, then take the some extra time during the planning phase of the business to list out the reasons why you want to go into this together. List your reasons and keep that list close for you to revisit often. It will help you remember why you wanted to start this business in the first place. Hopefully by knowing these reasons, you will set yourself up for success by communicating openly, holding each other accountable, and setting boundaries between your personal and professional lives.
Be sure to make time together outside of the day-to-day drill of the business. Doing non-work activities like you did prior to being business partners is a must to maintain your friendship. Plus, planning a day out together or even just grabbing a dinner together here and there to talk about life, not business, will help prevent burnout and strengthen your bond as friends.
Lastly, don’t get so wrapped up in work that you forget to celebrate your successes together. Maybe plan something fun to do every time you hit a business goal. You will check things off your to do list daily, so take time to acknowledge these milestones. You are achieving these together and it is impacting your business, so it is worth celebrating.
What Did You Decide?
We have listed reasons working with a friend is beneficially and some reasons why it may be difficult. So how do you feel about this decision now? Yes, starting a business with a friend can be a great idea, but it is not for everyone. Give yourself some time to consider the advantages and disadvantages. Next, speak with your friend and have an open conversation about what this business means to you, what your expectations are, and how you see your roles playing out as you forge this business relationship together. If you feel you are on the same page in the reason for starting this business, your values behind the business idea, and how you plan to work together putting friendship first, then you may have enough information to make a healthy informed decision about your future.
In conclusion, starting a business with a friend can be a rewarding and fulfilling experience. If you take caution early on to maintain a healthy friendship while running a business and celebrate your successes together, then you will be creating an exciting opportunity for you both to learn, grow, and create income. Remember two heads can be better than one if you are on the same page and enter into a business as equals. Take the time to set yourselves up for success and that is exactly what you will create together.
If you need more guidance on taking the next step in your career, learn more about the ways we can work together!
Related Blog Posts:
