Picking the Right Partner(s)

By July 14, 2010blog

I’m still amazed at how great a business partner Attila was for me at RegOnline. I’ve also been involved with and seen many other partnerships that haven’t gone so well. I get asked every so often my thoughts on partnering-up and partnerships. So here’s my experience…

Attila & I didn’t know we were going to be great partners. A friend we both respected suggested we might be good together. We had a short romance of daydreaming together about the future potential of RegOnline. I liked his common sense business approach and his willingness to speak the truth directly and without emotion. But that, in itself, would not make for a great partner.
I’ve seen many people be unhappy with their partners and wish they had done things differently before jumping into bed together so quickly.
Attila & I had a feeling it could work to become partners. So we discussed the terms under which I could buy in AFTER a 4 month trial period.
After 4 months I knew:
1. I loved the business, it’s future, and had a sense I could add real value
2. Attila and I had a similar work ethic (hard when needed, but not non-stop)
3. We had a similar philosophy in growing our team (be direct, compliment sincerely, take action, hire sparingly)
4. We had a similar approach to testing new things, but always staying focused on growing profitability
5. We felt the same about taking care of customers and doing what’s right by them first.
6. A shared sense of humor to laugh with each other every day
After 4 months I don’t think there was a question in either of our minds that we had found great partners in each other, so we did the paperwork and officially became co-owners of RegOnline. 4 years later, we had had a lot of fun building a great company together.
So my advice to people considering partners/partnerships:
1. Have a no-strings-attached trial period with a plan for what happens if both people are delighted to be partners together.
2. Give the founder/controlling partner an easy way to buyout the other partner if things don’t work out in the medium term (up to 2-3 years).
3. Share decision making power, but let the founder/controlling partner pull the trump card every so often.
4. Share/show appreciation for each other a couple times a year.
There’s also another type of “partner”… called investors. If you want to build something great (vs. be pressured into cashing out in 3-5 years) make sure your investor-partners are on the same page as you. Tony from Zappos shares his experience on why he felt forced to sell in this excerpt from his book, Delivering Happiness.

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