How
to Avoid Disaster When Couples Become Business Partners
Jean
R. Charles
hen
every dollar counts -- as it especially does in these tough
economic times -- many couples decide to go into business
together.
But
just because you live together doesn’t mean that you know what it
would be like to work together. Personality traits that might be
acceptable at home -- forgetfulness or procrastination, for example
-- can set off alarms in the office. Common traps and what
to do...
TRAP: Having differing levels of risk
tolerance. Problems arise when one spouse is
comfortable with taking greater financial risks or making bigger
monetary investments in the business than the other. To determine
the risk comfort zone for each of you, start by defining the lines
beyond which neither of you will go.
Example: Are you both willing to use
your home as collateral for "seed money" or to finance inventory
purchases with credit card debt?
If you
are the more "risk averse" partner, have your spouse show you the
numbers. You may find that there is a greater margin of safety than
you realized or, conversely, that you both need to do a little more
research before taking the gamble.
TRAP: Failing to establish boundaries between work and
home. Some couples find that business is all they
talk about, which can put a strain on the relationship. Establish
ground rules.
Example: Best-selling authors Paul
and Layne Cutright (who co-own The Center for Enlightened
Partnership) have established a "no business discussion" rule for
their bedroom. Other couples agree not to talk business during
dinner or after 9 pm.
TRAP: Not operating as a team. It’s important
to present a unified front to vendors, clients and employees. While
you both need to agree on who handles what areas of responsibility,
you still must function as a unit.
This
can be especially challenging when one partner has difficulty
making or supporting decisions that are likely to upset a third
party, such as refusing to extend credit to a customer or
disciplining an employee. Successful entrepreneurial couples check
with each other before making any important commitments, back each
other up in public and work through disagreements in private.
TRAP: Not having a written agreement. In my
eight years as a business coach, I’ve heard the same faulty
reasoning repeatedly from couples ("We don’t need written
agreements -- after all, we’re married") and watched months down
the road as the venture and the marriage unravel because of it.
Couples need a detailed partnership agreement identifying the goals
for the business as well as the responsibilities of each
partner.