Choosing a business partner for a new business is a huge responsibility and will
have a large impact on the success of the new business. Therefore, entrepreneurs
need to take time over the decision.
Often, an entrepreneur who is not really well versed in the area in which the set
start-up business is being established will try and hire a partner who has intimate
knowledge of the area. This improves the new business venture's chances of success
and also makes for a more impressive corporate bio that the entrepreneur can use
to raise funds.
Most business investors, especially venture capitalists, are very weary of lending
money to entrepreneurs who do not have any experience in the industry. Venture capitalists
prefer to invest in business proposals that have been able to elicit positive responses
from top management people.
A lot of entrepreneurs who are starting a family business, such as a new restaurant,
consider taking their spouses as business partners. This is a difficult decision
and one that needs to be given careful consideration.
Before deciding on whether to take a spouse on as a business partner for the new
business, entrepreneurs need to consider the personalities of the two individuals.
If both individuals are opinionated and temperamental than it could spell trouble
for the new business as well as for the home.
Another consideration that an entrepreneur needs to make before taking on a spouse
as a business partner is whether the family is willing to "put all its eggs into
one basket." Establishing a new business is a risky business and requires a lot
of financial commitment. Most families prefer to have one partner working a regular
job while the other works on stabilizing the new business.
While choosing a business partner for the new business, the entrepreneurs also need
to take into consideration the structure of the business. Some structures work better
An entrepreneur also needs to consider whether he or she wants a working business
partners or capital partners. Capital partners are like other business investors.
They have a say in major decisions that the company makes however they do not concern
themselves with the day-to-day operations of the new business.