Today we begin Chapter 7: Fish & Partners. We open with Ron’s intro to the chapter.
I love to eat fish. One time, my family and I caught a bunch of fish. When we arrived home, it was late and we were really tired. In fact, I was so eager to jump in the shower that I left the fish in the trunk of the car. The next morning, when I climbed into the car to go to work, it smelled terrible! It took several days and a lot of air freshener to get the stench out. Obviously, we didn’t eat the fish, and we didn’t go fishing again for several years.
We’ve all heard the saying, “Fish and company both stink after a week.” Rich and I would like to extend this advice to business partners as well. I’m familiar with a business that illustrates this issue.
It started in a garage. The two guys enjoyed working together. Their business became profitable and they leased a warehouse. They obtained some assets. More money came in, and they found themselves “living the high life.” Then, without warning, the market conditions changed, and they found they were treading water.
That’s when it came to light that one partner had set aside resources for a rainy day. The other had not been so responsible. He had accrued a high level of personal debt. Understandably, he did not want to downsize.
All of a sudden, contention arose. There were questions about what belonged to whom. The debt-ridden partner got a day job in the construction industry to make ends meet, but his heart was still set on the entrepreneurial upside. To his chagrin, his partner moved on to something new and let their venture stall. Fingers were pointed and the friendship was strained. The bootstrap garage utopia was lost because these partners’ ultimate goals were misaligned.
Obviously, not all fish stink; when attended to, fish can be delicious. I recently had some fresh salmon from Alaska. It makes my mouth water just thinking about it. Just as fish can be delicious, business partnerships can have a very important and useful place in starting and maintaining a business. But it is important to note that if you are going to bootstrap a business, all the partners must really be willing and able to pull themselves up by their bootstraps. If one partner is using the income from the business as his rice bowl and the other is just placing a bet on the business, then goals are misaligned and trouble is sure to follow.
This chapter is designed to preserve your partnership and prevent it from stinking up your venture and your valued relationships.
We’ll start the chapter next time where any good partnership starts: with setting expectations.