What is the best advice for entrepreneurs going into business with a family member?
5 WARNINGS BEFORE PARTNERING WITH A FAMILY MEMBER
- First, know each other’s roles in this company. (What are each of you responsible for and what are the consequences if someone does not fulfill their given responsibility/)
- Do you need this family member to start this business? They need to bring something critical to the equation or you have someone your sharing money with for no reason.
- Make it clear you are partnering with the individual NOT THEIR SPOUSE AS WELL. Spouses and partners tend to put their 2 cents into a family business even when they personally are not a partner but their partner is your partner.
- Establish how you will argue and or break ties. Rules of Engagement
- Have a simple partnership agreement on how you are splitting profit, how to buy each other out, no-compete, etc.)
