Businesses are always on the hunt for proverbial “next big thing” to help them grow.
Understandable, although not exactly actionable.
Rather than wait for success to fall into your lap, sometimes a joint venture or a partnership is exactly what you need to take your business to the next level without playing the waiting game.
Maybe you need extra capital for a particular project.
Perhaps you’re trying to break into a new market.
Business partnerships can certainly be the key to reaching such goals without punching above your weight.
That being said, joint ventures and partnerships involve much more than a simple handshake. In fact, partnering up with another company can be cause for a whole slew of headaches if you don’t treat your potential business relationships with care.
How so? Below are six tips for connecting and collaborating with other companies in your space effectively.
Make Safety Your Top Priority
Perhaps one of the most important yet overlooked aspects of partnering up is simply protecting your business’ digital and intellectual property.
For example, others might be interested in specific reports or documents either to verify sales information or collaborate. Although this is completely understandable, doing so shouldn’t be done via an email chain or the likes or Google Docs. Instead, consider a third-party tool to share sensitive documents in a safe environment rather than risk a security snafu.
Don’t Give Away Any Secrets
On a related note, your business’ trade secrets and ideas are potentially vulnerable when you start hashing out details with potential partners.
In other words, don’t reveal any big ideas or discuss sensitive information until you’re serious about working together.
You shouldn’t assume that anybody is out to get you or use a partnership as a front to pick your brain for free. Even so, we all run the risk of someone stealing your idea in a day and age where businesses are so transparent with their information.
When in Doubt, Lawyer Up
Highlighting the points above, legal counsel can provide some much-needed peace of mind when working closely with a company (even one you have a good working relationship with).
The purpose of a lawyer in the case of a JV or partnership isn’t to act as a mouthpiece or intimidate anyone, but rather keep the relationship moving without any hiccups.
For example, the legal definition partnerships versus joint ventures can be murky and likewise complicated from a tax perspective. WIth a lawyer who specializes in such matters on-call, there are fewer question marks surrounding the legalese of your relationship.
Always Put Business First
This might sound harsh but it’s a smart principle to live by.
Again, the purpose of a partnership is to advance both parties’ businesses goals first and foremost. It may be tempting to go into a JV or partnership for someone who you have a close personal relationship with, but it’s best to err on the side of caution in such cases.
Why? Although going into business with a friend might seem like a brilliant move, doing so isn’t without its downsides.
When egos, passions and personalities start to clash, you run the risk of damaging your personal and business relationships in one fell swoop. Sure, it’s nice to get along with your business partners on a personal level; however, that shouldn’t be the deciding factor in your decision to work together.
Make Sure Both Sides Benefit
This is a big one although it seems like a no-brainer.
Partnerships should represent symbiotic business relationships, where working together is a win-win situation. No one party should do the bulk of the work involved in a project or reap most of the rewards. If feel that the other side isn’t pulling their weight or is otherwise dragging their feet while negotiating, that’s not a great sign for things to come.
When in Doubt, Trust Your Instincts
Most experts will tell you to look at data and hard numbers before trusting your gut, right? Totally understandable.
However, sometimes it is best to let your instincts guide you if you think there’s something off about a potential partnership. Ask yourself: if you feel uneasy or uncertain about the situation, are you willing to put your entire business in potential jeopardy for the sake of growth? Obviously this isn’t an easy question to answer and every business is different. That said, anyone on the end of a partnership should use their best judgment and trust their instincts.
Again, collaborating with other businesses goes hand in hand with steady growth. Just remember that you can’t sacrifice your company’s long-term success and well-being for the sake of a relationship that simply isn’t going to last. With the tips above, you can move forward with a partnership or JV with some much-needed peace of mind even if you’re still in the planning phase.