What I Look For in a Business Partner
Before I go through the characteristics of what I look for in a business partner that I personally consider most important, I want to first note that finding the right business partner has many nuances to it, and it should be analyzed on a case-by-case scenario.
Second, this is what I look for in a business partner or founding team who will be running a Polpo company alongside myself. I am specifically looking for CEOs and people who will run the business day-to-day, so it might be slightly different to what you need from a partnership.
And third, while it takes years to really know someone (and even then people might surprise you), this can be sped up by having deep, tough, and uncomfortable conversations early on —so don’t shy away from them.
So, what I look for in a business partner can be broken up into two things: prerequisites –basic elements that I need to see before I even consider it — and, if they have those, then deal breakers.
Let’s start with the basics:
At least one person has to be an industry expert.
He or she has to know the ins-and-outs of the industry that the company operates in. They also need a track record –proof that they know what they’re talking about. For example, if I were to partner with a recruiting agency, I’d expect someone in the company’s leadership team to be experienced, knowledgeable, and well-versed on recruiting.
It’s hard enough to grow a company to also have to learn all the subtleties of the industry. It is much easier when you start with an existing network, reputation, and proven capabilities that you know what you’re talking about.
There also needs to be someone that has a “killer instinct.”
Every company goes through times where shit hits the fan. We definitely did at Jakt. There’s always a critical point that puts your back against the wall –and you either come out swinging or fold like a house of cards.
Some people can step up when it really matters and some people can’t. This is an intangible ability, and it doesn’t depend on your hard, technical skills. It doesn’t matter how good you are at recruiting if you don’t show up when it’s life or death. Either you have that character trait, or you don’t –there’s not much more to it.
And I can’t be that go-to guy with Polpo because I’ll be running multiple businesses, so that’s a decisive quality that I look for in a business partner.
There has to be someone that is great at sales.
Sales are an essential element that all successful businesses need, and its importance cannot be understated. No business can survive without revenue, but there’s plenty of CEOs and Founders that could not sell ice-cold water on a Spanish beach.
Selling is a much-needed skill in business –and not just during your customer acquisition process. You are also selling your company to potential new hires, you are selling a culture to current employees, and you are selling yourself as the individual that can lead a team.
Honestly, it’s very straightforward: if you can sell, you’ll make money. If you can’t, you won’t –no matter how good your product or service is.
And then, there are the deal breakers:
The way they think about money.
The way your business partner thinks about money is a crucial element that can make or break your relationship (and your company with it).
For example, I have lived below my means for plenty of years to reduce my living expenses and reinvest all the profits into the business –and I still do it. I can (and did) not take a salary for a few months and only eat PB&Js while we ramp things up. If my partner cannot, well, we have a problem.
And living with low-expenses is easy to do when you are just starting out and you’re broke, but what will happen when you guys start growing and making profits? Will your priority be your business, or will you take your money and run the closest club in your city? What will your partner do?
You have to understand what your partner’s relationship with money is, and how that will affect you and the company going forward. Is he okay with investing in your company and scaling, or does he keep his cash under the mattress? Is he financially solid, or does he owe $100k to Russian mobsters? These are all the things that can (will) threaten your company’s livelihood if you don’t previously do your due diligence.
Where they want to take the company and themselves.
Similar to the point above, not everyone has the same expectations and ambitions about where they want to take the company and themselves –that’s actually one of the main reasons my partner and I parted ways.
Some people are happy with building a small company that covers their living expenses, while others want to keep on scaling and growing. Some people see themselves living in peace in the Bahamas, while others enjoy the daily work of running a business.
Now, I’m not saying one of these is necessarily wrong, but what’s important is that you and your partner’s expectations align. Both of you should have the same aspirations and the same goals –both personal and professional, or the relationship (and the company) will be in danger.
The rest of the stuff, i.e., how to be a good manager, the technicalities of cash-flow, or any other hard skill, can be developed, but these traits above are really hard to teach and change.
Who they are as human beings.
They say business is not personal –but I disagree. Who you do business with matters. If we don’t share a common set of values such as treating people fairly, being respectful, and caring, there is no way our business relationship will work.
You want to partner with people that have a similar way of being. Now, I’m not saying both of you see the world the exact same way, but you do have to share a basic sense of ethics, morals, and attitude towards the people around you.
What I look for in a business partner: The Takeaway
Getting into a business partnership is not just about liking the person. I shared with you my requirements when I look for someone –and yours might differ, which is totally ok–, but make sure you do your due diligence and truly get to know that person before you commit your business to them.
If you want to read more about the things I’ve learned (and continue to learn) throughout this journey as the CEO of a multimillion-dollar company, read the 5 Lessons I Wish I’d Known That Would’ve Saved Me $100,00+