Can a Business Partnerships Work Out?

April 16, 2007 by mrbizplan.

Anonymous Asks:

In my quest to start a small business I have run into the opportunity to partner with another artisan who is skilled in my craft but doesn’t have a lot of money to contribute.  What are the things I should consider before partnering with this person? 

Mr. BizPlan Answers:

I meet and work with about 200 entrepreneurs a year who are interested in starting a small business.  Every time I have a meeting with two or more people involved in the same venture, they always say the same thing:  

“Jane and I are staring a XYZ Shop on the north side of town.  I have the funds for the down payment and she has the skills and expertise.  We are going to split the profits 50/50.”

To this I typically offer the following rules of a partnership:  

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