We all remember those times as children and young adults where we would fantasize about what we want to be when we “grow up”. Often, those dreams and aspirations of grandeur included our closest family and friends, and getting into business with them. The extension of these personal ties into professional relationships is only natural, as both are based on a common bond, similar values, and most importantly, a shared trust.
As our lives unfold, we obtain certifications and degrees. We compile intelligence – both social and academic. We look to set ourselves up for our adult years and into retirement. To put ourselves in a position to achieve our professional goals, we often continue to look to those closest to us in order to bring our dreams to reality.
If you are considering a business venture with a friend or family member, plan and prepare for the good and the bad. Define the relationship from the outset in terms of who is bringing what to the table. Take the time to obtain legal advice on the corporate structure of the business, possible shareholder agreements, and any other document that may help guide the ship. Perhaps above all, discuss and plan for the possibility that although the business may succeed, the business relationship will fail. Set out a roadmap for how the parties intend to deal with a possible “divorce” between them. Do this before you commence in business!
Getting into business with family and/or friends can be a fantastic experience, but adversity can also tear down the very foundation of those relationships. In my experience, I have been litigation counsel in business disputes between siblings, parents and children, and best friends. If I have learned anything from those disputes, it is that no matter how deep the bond, conflict over money and power can destroy life-long connections. Spending some time and a bit of money on a plan now can save you from spending a lot more time and money on a solution later.
~ Nav Parhar