A friend of mine is looking to start a business but he doesn't have enough capital so he came to me and asked me to become his business partner and run the business together.
What are the factors I should consider before sharing a business with a partner?
That's nice idea, that you seek opinions before embarking on a partnership terms with your friend in a business course. You should consider the following terms before agreeing to start up such business with your friend.
* Conflict, where one or two join together to start a business, sometimes conflict might come. The two parties should find a way to settle it amicably to avoid crash down of the business.
* Decision making; this one poses lots challenges in any start up, because during the decision making on any business initiative. One will be feeling cheated when the other is single handedly making the decisions on their business welfare. It might be that the other contributed more capital than the other so he will feel more superior than the other. If not settled amicably, it crashes down business.
* Capital; capital plays a major role when it comes to business success. But when it comes to one person contributing more money during the business start up, it can lead to disagreement. Because the other, will like to show superiority over another, making the business not to reach galaxy. But when settled amicably, their won't be hindrance to the business. This kind of issue is often in the partnership business. You need to consider it, before going on partnership with a friend.
* Profits, profits should be shared equally among the two partners. But in the sense, one brought more money into the business, he will feel that he takes the lion share. Putting doubt in the business.
* Business plan, this one is the key to moving a Business firm forward. When the two partners fails to engineer vision and plan into their business, it crashes down. Because one will feel cheated when the other makes the plan single handedly without contacting him.