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Do you have a great business idea, but you do not want to run a business by yourself? Finding potential partners to share your business with can be a challenging process. You have big dreams and aspirations for this business, and how do you know that this person is a good fit and shares these goals? This article will outline the pros and cons of entering into a business partnership and outline some tips for finding the perfect business partner in New Zealand. 

What Is a Business Partnership?

A business partnership is a type of business structure where you share all profits and losses with another person. Partnerships can be between two or more people. Usually, partners will have an equal share in the business. Frequently, partnerships are used in law, accounting and farming industries in New Zealand.

Is a Partnership the Best Option for Me?

You should carefully consider whether entering into a business partnership is the best option for you. There are several pros and cons to being in a business partnership, so you should make sure you carefully consider your options and your business needs to see whether a partnership is right for you. You will need to think about whether you are comfortable sharing the business’:

  • control;
  • income; and
  • responsibilities

with another person. You will share control of your business, but you will also have someone to help you make challenging business decisions. A partnership allows you to bring in a new set of skills to your business. You will also have financial and professional support in your business venture. However, working with someone can be challenging and you will need to manage partnership challenges.

In some cases, partnerships may not be entirely equal. For example, some partners may not want to be involved in the business’s day-to-day operations. However, other partners may want to be very hands-on. Make sure that your partnership arrangement suits you. 

Tips for Finding Business Partners

Finding a good business partner can be difficult for entrepreneurs, as there are several different sources of possible business partners. Whichever avenue is best for you will depend on your circumstances and what you want your business partnership to look like. Therefore, you should carefully consider each partner’s pros and cons, make sure that you are very aware of any risks that may occur and account for them in your partnership agreement. 

What Should I Consider When Looking for a Business Partner?

Does their skill set complement yours? Or do you have the same skills? Having slightly different skills can be helpful for better creativity and success in a business partnership.

What type of business values and beliefs do they have? It is a good idea to ensure you will not be fighting over the major issues that people are less inclined to change their minds on.

What are their long-term goals and aspirations for the business, and are they similar to yours? For example, if they only want to be involved for a few years before moving on, it is good to either plan for it early on or choose a partner who wants to be involved on a long-term basis. This way, you can plan to achieve your business objectives.

Is your business partner financially stable with good business insight? Check to ensure that they have never been bankrupt and check whether they are held in good esteem by their former employers. These indicators can help you determine what kind of business person they are and whether they would make a good partner. You will need to have a high level of trust in this person, so they should be trustworthy. 

Check-in With Your Colleagues

If you have worked with people in a similar career field to you, they could be the perfect business partner. You will know what they are like in a professional environment, their strengths and weaknesses, and their business ideology. In addition, it is a good idea to be on the lookout for colleagues who may be wanting to change their career or take a different path, and therefore would be more open to entering into a partnership.

Collaborate With Friends and Family

If you have friends you studied with or are in a similar field to you, they could also be the perfect business partner. However, even though your friends may have a great relationship with you, they may be very different professionally. If there are issues with the partnership, then there is the risk that it will ruin your personal relationship. 

Go to Industry Networking Events

Attending industry networking events in New Zealand can be a great way to source people interested in a business partnership. This will also allow you to meet people outside of your existing network who may have different skill sets than you. 

Use Social Media and Online Sources

Posting on LinkedIn and other social networking sites expands your pool of people and possible partners. In addition, you can share your idea and message with friends of friends who may be exactly who you are looking for. 

You can also attend online networking forums and events as well as in-person ones. Furthermore, there are also websites where you can create a profile of you and your business and say that you are looking for partners. Getting your name and story on these networks and forums will attract the interest of like-minded people to your business, potentially leading to a successful business partnership.

Key Takeaways

Deciding to enter a business partnership is a huge decision and one to consider carefully. Once you know that a business partnership is the right decision for you, it is good to keep in mind a clear set of values that you want in your business partner and ensure that they are a person who you trust. To find business partners, check in with your old colleagues, friends and family, go to industry networking events, and use social media. 

If you need help with your business, our experienced business lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0800 005 570 or visit our membership page.

Frequently Asked Questions

Should I choose a business partner who has the same skills as me?

It is best to find a business partner with similar goals and values to yours, but having a partner with different skills will allow for a more flexible and creative approach to your business. In addition, you can use your different strengths to improve the overall success of your business. 

Do business partners have to have the same role in a partnership?

No, your partnership arrangement should work for all partners, even if this means that you have different roles and responsibilities. This can be outlined in a partnership agreement.

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