The old adage talks about not mixing business with pleasure; But how about mixing business with friendship ? Recently, I’ve started discussing a potential business idea with a very close friend of mine, someone I know from childhood. Now this is not something that is likely to take off immediately, so we have all the time we need to talk about it, explore things etc, and we are finding that part itself a whole lot of fun. When my friend brought up the idea, instinctively, I said Yes ! Probably because of the closeness we’ve shared over the years, which has included some catfights and other ups-and-downs, I have this comfort level with taking on a new role with her as a business partner. In general though, I don’t think one can automatically guarantee that working with a friend will go well, either on the business or on the friendship count.
Starting a new business comes with its own share of risks and uncertainties. The friendship has to be close enough to weather that. For example, if the business doesn’t work out, there cannot be a situation where one blames another for it. One of the basics has to be that both partners clearly bring some value into the work. No one can be a partner, simply because he or she is your friend.. Going this way, I think, would be a sure-fire recipe for failure. Not only will one person fail to pull their weight, later, when things go wrong, it leaves a large space for the recrimination game. Both partners ofcourse don’t need to be actual experts on the subject – one could be a technical expert, the other a finance whiz ! One could be the ideator, the other an implementor…or maybe both are jack of all trades ! Infact, if you look at some Indian businesses, where third-generation members were inducted solely because of their family ties, its clear that they didn’t have either the passion or skills for the business. So at a first level, calling in someone because they are friend or family, may provide a deceptive comfort that fails when things go tough.
Another important thing would be the level of honest communication possible between the partners. Sounds basic, but isn’t. Money often makes many simple things difficult. But – if its not a friendship where you can discuss these things with ease, then maintaining both the business and the friendship would be tough. So issues like who brings in the money, how do we divide it, who brings in new clients, who is responsible for legal issues, should be discussed in detail. Its not necessarily, that both partners always be compensated equally. Maybe one person puts in more money or time. Perhaps, as the business achieves a critical mass, one person wants to move onto other things and be a sleeping partner. Personally, while I know a lot of people who have good ideas, I wouldn’t consider a partnership with all of them. This friend, when she buzzed me, I had no hesitation in saying yes, because I knew I could be upfront about all of this. (I am not going to be talking about the idea itself right now, since its still getting finalized and I don’t want to let the cat out of the bag, but gradually, you should see more references on this blog:)
These are some of the things that I can think of for myself. What other caveats do you have for mixing business with friendship ?