The Boss of You

AKA: Why you need a part­ner­ship agreement.

I men­tioned in my post ear­lier this week about busi­ness part­ner­ships that I’d address the issue of part­ner­ship agree­ments here, so here we go. We go into this in detail in the book, but really it’s quite sim­ple: you need a part­ner­ship agree­ment. I don’t care if your busi­ness is with your mother, your sis­ter or (per­haps espe­cially) your one true love, you must have a part­ner­ship agree­ment. In a worst case sce­nario, a part­ner­ship agree­ment is what will help to make that worst case sce­nario a lit­tle less hell­ish. In a best case sce­nario of an ami­ca­ble busi­ness break-up — maybe your busi­ness part­ner has an oppor­tu­nity to move to a trop­i­cal par­adise and wants to end her role in the busi­ness — it will still help make sure that the split­ting up of assets (or debts) is fair and square and fol­lows the rosy pic­ture of life you had in the early days. Is it worth hav­ing a lawyer look over your part­ner­ship agree­ment? Def­i­nitely yes. Is it absolutely nec­es­sary? Well, I’m no lawyer, but I’m inclined to say prob­a­bly. Can you get away with doing that until you’ve at least made enough money to pay the lawyer? Sure. Just make sure you have some­thing basic in writ­ing and wit­nessed, and make sure it doesn’t get put to the bot­tom of the list when you do get the cash in to make that legal trip.