I get asked a lot if it is a good idea to go into business with a family member or friend.
Having a business relationship with a relative, spouse, or friend can be a very complex and difficult experience, because the working relationship can affect the success of the personal relationship.
Even science suggests that friends who are like-minded should never go into business with one another.
Those with a birds-of-a-feather mentality tend to make costly decisions when working together, according to a study from Harvard University.
There can be problems with boundaries and expectations, or separating professional lives from personal lives when working with a friend or relative.
Here are some important questions to ask before going into business with a friend or relative, according to Entrepreneur.com
- Do you have a trusting relationship with this person and are they ethical? Make sure you talk about what each person’s job description is and how not to intertwine your perspectives.
- Will they be a good ambassador for your brand?
- Are you both in it for the same reasons?
- What skills would they bring to the table that you do not possess? Is this person experienced or do they have credentials to do the appropriate job?
- Are they in a stable place in their life to be able to commit to the business long term?
- How do they handle high stress, finances, and business decisions? What if you disagree, how will you figure out a way to compromise and remain in a professional relationship?
- How would you handle family situations if they have children that are ill and you have a presentation or proposal to do?
- What type of ownership percentage or equity will you be negotiating, and are they willing to work part or full time?
- Will you hire someone to write up a business plan, legal agreement, and create an LLC or partnership? This is extremely important.
- Will you have a board of directors and advisors? How will you incorporate each partner’s performance evaluation?
- Will you be able to keep your professional and personal lives separate?
Do not allow working with a friend or relative to cloud your judgment. Focusing on goals and objectives is essential while maintaining healthy expectations and boundaries.
Having personal issues and stepping over boundaries will deplete the professional relationship. After reviewing these questions, you might realize working together can be a very difficult journey when you creating a business partnership with a family member or friend.
Frustration, anger, and hurt can result into a permanent separation from someone you once were close to. You must ask yourself if it’s the worth the journey?