The Creative Partnership Starter Pack

Five conversations you need to have with your (existing or potential) business partner

One friend turns to another and says, “Let’s start an ad agency.”

Or film production company, or publishing house, or podcast. Let’s make a cool consumer product or change the face of an old category. Two friends start a company. What next?

I’ve been consulting and coaching for over a decade, and in that time I’ve worked with quite a few partners. Two people, friends or colleagues, decide to go into business together. Since I work with creative companies, one or both of them is usually a creative, a maker, a builder. Often both partners are creatives. 

Some of the partnerships have been successful, and I get to see what works in the real world. Others are not. I’ve watched a number of unwindings, done with varying levels of skill and rancor.

Here are some things I’ve learned that I think of as a partnership starter pack. Since I don’t talk about my clients, I’ll use some examples from my creative partnership with Eugene S. Robinson on our podcast, the Bad Boss Brief. It’s not a business, but it’s illustrative.

These guidelines be used at any time, but I’m thinking mostly of the start, that new, exciting, tumultuous time.

Group Agreements

Anyone who reads my work, or works with me, knows that I am a big fan of teams deciding how they want to work together using a group agreements process. This is especially important with founding partners.  Often, partners think they know the answers to these questions, but it’s useful, and sometimes surprising, to go through the exercise of asking them. The goal is to get to a clear understanding of how you want to work together. A partial list of topics might include:

·      Who does what? You might think it’s clear, but it’s good to get it written down. Are there any areas of potential overlap? What do you do with the overlap?

·      Are you each working to your skill sets and preferences? The detail oriented one should be dealing with details. It sounds obvious, but it’s not always. What do you hate? If there’s a task that one person loathes, and the other doesn’t mind, then it should be assigned accordingly. Same with tasks that are much loved.

·      How do you make decisions? Do either one of you get a veto? And if so, in what circumstances? What if you disagree? Do you have areas of expertise where one of you gets to have a greater say? For example, if one partner is responsible for finances and cash flow, does she get to have the deciding vote on investments or expenditures because of her expertise or is it a joint decision-making process regardless of expertise? Is there a trusted outsider you can agree to connect with if you can’t resolve a difficulty?

·      How do you handle conflict? Get specific. You are peers, and have some sort of existing relationship. Understand the other person’s conflict style; what works, what sets them off, how they process anger or frustration.

·      What is your partner’s communication style and work style? You may think you know this, but it’s good to clarify. When do you work best? How much travel do you want to do? What are your expectations in terms of communications? I’ve seen people get really specific -- Slacks and emails can be ignored until the next day, but a text needs to be answered right away. Or a partner with young children may say they aren’t available between 6 and 9pm but can check in after that.

·      This list can go on and on

Maintain

One of the hallmarks of friendships is that we don’t talk about the friendship itself that often, in contrast to romantic or sexual relationships where we are prone to want to clarify or define what’s happening. Most business partners I’ve seen rarely carve out time to check in on the business partnership relationship. It’s not gendered, both men and women don’t see the need to prioritize checking in on the business relationship. But I highly recommend it.

Here's an easy tool I suggest to my clients. Have a time to meet, and keep it. Once a month is a minimum, twice a month is better. Connect in a way that is comfortable, ideally in person and out of the office. Take a walk. Get a beer. Answer these three questions. Do it one at a time – partner one answers question one, then partner two answers question one, etc. It’s ok to be embarrassed or have an eye roll, but do it anyway.

1.        What went well since we last met, or recently? Be specific about an interaction between the two of you, or something your partner did that was welcome, delightful, appreciated, or skillful. It can be small or large, but it means something to you. This is called “appreciative inquiry” and is always a good way to start.

2.        What was challenging? This needs to be answered every time, even if it’s something small, so you two can build the muscle memory and skill of addressing conflicts in advance of really needing it. A few small “please put the dishes in the dishwasher” level conversations can pave the way for the more challenging, and important “when you say that thing it undercuts me in front of the team and is demoralizing to all of us.”

3.        What would you like to see instead for the challenge? Get to solutions.

Here’s an example of 2 and 3. “I know we’re busy, but you’re often about ten minutes late to a meeting. And it’s bothering me. It feels disrespectful to the people who work for us, to our vendors, and it puts me on the spot. What can we do to fix that? Do we need to schedule more time between meetings? Do we need to have more of a ‘divide and conquer’ strategy so we don’t both have to be in as many meetings together?”

See what happened there. Acknowledge the situation – we’re busy. Soft start, no blame. Name the facts. You are often 10 minutes late. Not “you’re always late” but the softer “often” with the specific 10 minutes. Then a question – what can we do to solve this? With some concrete, non-blaming suggestions.

The key for the person receiving this feedback is to not get defensive, and to look at both the practical solutions as well as what might be lying underneath. How does the first partner who called this out feel when she’s sitting on a video chat making small talk with potential investors for ten minutes waiting for you? If you’re a man, does that give a subtle gendered message, like she can’t start without the guy in the room?

And I will note that if this imaginary pair of partners had done a thorough group agreements exercise, he would know that his partner is punctual and doesn’t like meetings starting late, and she might understand that he doesn’t do well with strict timelines and might need more space between meetings in case one runs over.

Thirds

I often reference data and ideas about marriage because more people study marriages than work partnerships, and I’m a fan of the Gottmans, a married couple who study married couples. They talk about the dangers of an outside person destabilizing a relationship. In a marriage, this could be an older child from a previous marriage who has a substance abuse issue and wants Dad to bail him out over and over.

Business partners should also consider the role of thirds and get some guidelines around it. This is particularly important where the business partners have spouses or romantic partners with whom they share finances. A woman who invests all her savings into a new business venture may have a husband who feels invested in the success of that business, since they share finances and her savings are his savings, or she borrowed against their house to finance the business. Let’s assume you’ve covered the legal aspects of the risk by incorporating or what have you. But there is still a concern.

How involved do spouses or romantic partners get to be? What if the aforementioned husband is a CPA? Does he get to look at the books? Do you want him doing your taxes? Often spouses or friends will work for less money or, in some cases, no money, which is great when a new venture has limited funds. But it is also fraught with risk. The partners need really clear guidelines in these situations. Do we hire friends, partners, children, family? What if there’s conflict?

I’ve seen some companies who successfully integrate family members, so I’m not suggesting this shouldn’t happen. I’m just saying that it can be difficult, and it’s best to have clear guardrails as well as an understanding of how to handle conflict, who gets paid what, and how these thirds will participate in decision making.

Plan the end

Hopefully, you have legal documents about who owns what, and how assets get divided in case you end the partnership. It’s important that you’re clear about how you navigate an end, even if you don’t want to see an end. Do this now, with a lawyer, because if you don’t it will make any end messier.

Look at different reasons to end your partnership. It might not be a business divorce. One partner could become ill, or die. Do you need insurance to cushion that kind of a blow? What if a partner becomes incapacitated through mental illness? People don’t talk about morals clauses much anymore, but is there behavior that is so egregious you wouldn’t be able to work with a person who would do that? What do you do if someone is compromised by addiction? Is that treated like any other illness such as cancer?

Who gets what? Like the end of a marriage, the end of a partnership will require a divvying up; the brand name and all that is associated with that, the content or IP you generated, any residual income from that IP, the financial obligations in a long-term lease or investment in equipment or staff.

Who owns what?

Eugene and I don’t have any kind of legal agreement because we don’t make much money off our podcast. And we’ve been friends for decades, so we trust each other. But we’ve talked clearly about what we do with money that will come in, and who pays for what, and who owns what. We use the band model – anything we do together we split. Anything we do solo we get to keep. It’s not complex, but it’s clear, and we had the conversation before we started spending any money, getting any money, or putting any content into the world.

Understanding what is yours, mine or ours is especially important for artists who do work together and apart, and often influence each other. When I was writing my first novel, thirty some years ago, Eugene read everything I wrote, as I wrote it, and we talked about the work extensively. He half-joked that he should get 3%. But I took it seriously. I didn’t end up publishing the book, so it was a moot point, but it was skillful that, in our twenties, we could have a conversation about the value he was bringing to the piece through the pretty considerable time he spent helping me. I’ve had other friends who weren’t professional writers or editors read my work and spend time on it because they were interested, or wanted to read it. They will figure prominently in any acknowledgements I ever get to write, but no one is expecting money to change hands.

Finally, I know that money’s tight, and you have all these important things to spend money on. But getting professional coaching to work through some of these conversations is a good investment. And it doesn’t have to be a huge one – a facilitated group agreements session would take me two to three hours, including prep and write up. You’ll pay a lawyer to look at your contracts, and a bookkeeper or accountant to set up your books. Why not pay someone to set up the way you work together as well? And then you have a third party who knows you and can come back in and do any adjustments or address conflicts that will come up along the way. And, yes, I did just throw in an ad at the end of more cool free stuff. Because watching a business divorce is a great reminder of the truth of the old adage “good fences make good neighbors.” Build your fences from the start.