Starting a new business is equally exciting as it is time consuming and stressful. There’s a lot that goes into jump starting any new business, no matter how big or how small it may be.
One of the first things to consider before you jump into the ideation and launch process of your new business is: should I start this business alone, or with a business partner? And, the truth is, there are pros and cons of both options.
This post will outline the pros and cons of working alone, and working with a business partner. As with all things in life, both options come with advantages and disadvantages that should be considered before you get in too deep.
Starting A New Business Alone Versus With A Business Partner
Before you get started on your next business venture, make sure you have a strong understanding of whether or not you want to do it alone, versus with a business partner. Although you can always change your mind down the line, it can be pretty dang tricky (and emotionally taxing) to buy someone out down the line.
One of the most important things to remember should you choose to work with a partner, is that you have a secure legal contract in place that outlines your agreement, roles, and payment structure. Remember, contracts are cold. They’re clear! This is especially important when working with friends or family.
Pros of Starting a Business Alone
If you’re starting your business alone, you’re in luck! There are plenty of pros that support this decision. In fact, there are even more pros than the three expanded points I’ve listed here.
- Streamlined ideation and production
- Less compromise
- Higher earnings
- You’re your own boss
- Creative freedom
- Business structure
- Hiring power
Ultimately, you’re your own boss! Which can come with a lot of freedom, and just as much responsibility. One of the most important things to remember when you’re your own boss is how to manage your time, so that you can get it all done in a day, and still have a life.
Streamlined Ideation and Production
A lot of entrepreneurs I work with in my mentorship program are often in a creative field of some sort, as am I. This is why I placed the number one pro as streamlined ideation and production, because us creatives like to have power over the creative process.
When you’re working alone, this can ensure that your vision is crystallized, rather than getting pulled a million different directions. Plus, if you’re following some kind of lifelong dream in starting your new business, then it can be hard to combine that with someone else’s dream or vision.
Being the boss still comes with compromise, even when you work alone. It’s vital that you always maintain a level of flexibility, otherwise the rigidity will constrict you from true success.
However, when you’re working alone, versus with a partner, you’ll find that you need to compromise a bit less. This can be especially satisfying if you’re someone who has a very clear vision of exactly what you want to do, and don’t necessarily want input from people other than your own audience.
One of the clear pros of starting a new business alone is the chance for higher earnings. Naturally, if you’re working with a partner, then you’re going to be splitting the profits in some way. While the split isn’t always 50/50, you’d still be taking home less than what you would if you’re doing it all on your own.
Cons of Starting a Business Alone
I don’t want to sell you on starting a business alone just yet. Because, guess what, just as there are pros to working alone- there are also cons! As is life. Being your own boss is no joke. Starting your own business is no joke. Which is why these cons should certainly be considered before diving in.
- Larger financial risk
- Taking 100% responsibility
- Developing ideas alone
- Lack of diversity in vision
- Long hours
- Possible income instability
Being an entrepreneur has become all the rage in the last 10 years, but the truth is, it’s not suited for everyone. And that’s okay! If everyone was an entrepreneur, then all of the entrepreneurs wouldn’t have any employees. Before putting in a ton of time, money, and energy to your next project, make sure you have a clear understanding on if this is actually well suited for you.
Larger Financial Risk
In the pros section we talked about the potential to have higher earnings, which sounds great. But remember, with higher reward often comes higher risk. That means, rather than splitting upfront costs to launch with a partner, you’re fronting all of that alone.
Additionally, until you get things up and running more effectively- you’re pretty much only making money when you’re working. That means things like sick days and vacation time goes out the window in order to stabilize and build a strong foundation.
Taking 100% Responsibility
Being 100% responsible for your business can be both a blessing and a curse. There’s something appealing about not needing to compromise, and being your own boss by following your vision. But when shit hits the fan, you’ll feel the weight of all that responsibility land hard on your shoulders.
Developing Ideas Alone
Remember how I said it’s vital that you maintain flexibility in business? Well, this is why it’s nice to develop your ideas with someone else, rather than fully alone. It can be easy to get so stuck in your ways, that you’re unable to problem solve outside of your narrow vision.
Diversity in the conversation, ideation, and creative process can help to unlock that rigidity. Of course you don’t necessarily need to have a business partner to brainstorm with, as you can hire out for various positions. But there’s something especially valuable in having a peer, versus an employee to learn on in this creative process with you.
Pros of Starting a Business with a Business Partner
Now we can take a look at all the pros of starting a business with a partner, as there are so many incredible benefits of working alongside someone else. Starting a business is a lot of work, and learning from someone else during this grueling process can be rewarding and fulfilling, alike.
- Shared responsibilities
- Dynamic ideation and creation
- Expanded network and reach
- More resources to pull from
- Help with decisions
- Potentially more business opportunities
Whether you choose to work with a stranger, a peer, a friend, or family member- just make sure that your agreement is clearly written out in a legal contract beforehand.
Trust me when I say that your working hours won’t be anywhere near “normal” when you first start your business. Even if you’re going with the “done is better than perfect” launch model, you’ll still be working around the clock when you first get started.
Having someone to split all of these tasks, calls, and to-do lists with can help to alleviate a lot of stress from your plate. This can also ensure you have more time with your friends and family, and that you still have a life in general.
Dynamic Ideation and Creation
Even when you have a clear vision, you can gain a lot from bouncing ideas off of a partner. Remember, a business partner is different from an employee, meaning they should be at the same caliber as you as far as expertise goes.
Make sure to go into your ideation process with an open, curious mind so that you can actually learn and grow from one another- rather than getting annoyed that this person isn’t thinking the exact same way as you. Diversity in thought, opinion and beliefs can actually be incredibly helpful in business.
Expanded Network and Reach
One of the best things about working with a partner, instead of working alone, is that your network and reach has instantly doubled without needing to do anything. Of course you may have some overlapping audiences, but overall- you will undoubtedly reach more people than you’d be able to reach alone.
This comes in handy for networking, collaborations, investments, sales, and even potential business opportunities down the line in your business together.
Cons of Starting a Business with a Business Partner
While working with someone can be really helpful in terms of splitting tasks and responsibilities, there can also be a lot of difficulties when it comes to running a business with another person. Most people think of their new business like a baby, and that baby can be hard to share.
- Making joint decisions
- Disagreements and relationships
- Sharing profits
- Personal and work boundaries
- Shared liabilities
- Conflict management
Making Joint Decisions
Sometimes agreeing with another person can be hard, right? Well, think about how hard it is when you have a super specific vision for your next launch, and your partner can’t get on board. It’s challenging to agree with someone on something you care so much about, especially when they probably care just as much as you do.
Disagreements and Relationships
Oftentimes, people who work together have some sort of personal relationship beyond the business relationship. While it can be fun and rewarding to work with a friend or family member, it can also be tough when you’re disagreeing at work consistently. It’s important to have a clear boundary between your personal and business relationships should you choose to work with a loved one.
And even if you’re not the best of friends with your partner to start, you’re likely going to develop some kind of close relationship with them working day in and day out together. Disagreeing at work can take a toll on your relationship, and even lead to fall outs.
A clear con of working together is that you’ll likely make less money as you’ll be sharing profits. No, it’s not like business is all about money, but let’s be real- what you’re making is meant to reflect all of the hours, sweat, and tears you’ve put into this thing. So you want that to be reflected clearly.
While it’s helpful to split the upfront costs with a partner, just make sure you understand this also means you’ll be splitting the profits, as well.
Good luck out there, my friends. Whatever option you choose, try to have fun with it!