According to Bloomberg Businessweek, "A business partnership is usually hatched in a state of inspired optimism when two or more seemingly like-minded individuals come together with an idea to create a product or service and develop it into a business."
A good partnership is like a good marriage in which each partner supports the other and often supplies something the other may lack. Whatever the inspiration, to make it work as it should, it's important to detail expectations - to know who does what and get it on paper before the marriage - as with a pre-nuptial agreement.
This is what these famous partners understood:
- Thomas Edison partnered with J.P. Morgan and the Vanderbilts to found the Edison Electric Light company. Edison supplied the ideas, and his well-heeled partners supplied the money - an excellent arrangement indeed. Today, that company is General Electric.
- Computer whizzes Bill Gates and Paul Allen predicted the future: software. Their partnership produced Microsoft, the biggest software company in the world. Similarly, Steve Jobs' marketing brilliance and Steve Wozniak's software knowledge created Apple.
They were the savvy ones. Coco Chanel understood fragrances but sold 90 percent of her company to marketing genius Pierre Wertheimer and Theophile Bader, owner of Galeries Lafayette, a famous French department store. Chanel No. 5 became one of the best-selling perfumes in history. As for the business relationship, it was acrimonious.
If you're contemplating a business partnership, unlike Chanel, consider these must-do's: Conduct your due diligence to understand what you're getting into, and prepare in advance for the possibility of a break-up.
In business, a pre-nup is called a partnership agreement. Write it up - before the honeymoon is over.
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