When Mark Zuckerberg says it’s a good idea to buddy up when starting a business, we sit up and listen...
Wanna hit it big in business this new year? Here’s why you can (and should!) go at it with your best buds
Zuckerberg’s might be the first name that pops into your head when you think of Facebook, but he admits he couldn’t have turned the social media platform into the giant it is today had he worked alone.
Speaking at a conference, he said, “Ideas typically do not just come to you. They happen because you’ve been talking about something, or thinking something, and talking to a lot of people about it, for a long time. It’s a lot of dots you need to connect so that you finally realize you can potentially do something; then you start working on it and realize that maybe it will actually work.”
He believes that when you exchange ideas with people who share your passion and focus, success is sure to follow. And who could be more in tune than a group of friends?
Gugu Mjadu, executive general manager of marketing at South Africa’s Business Partners Limited, shares Zuckerberg’s view. “People who run a business together must share similar values,” she says. She cites Pamela Skaist-levy and Gela Nash-taylor, founders of Juicy Couture, as an example. The two were friends before their small business grew to become a global brand. One of the reasons partnerships such as this can be successful, according to Mjadu, is because as friends you already have a good idea of each other’s strengths and weaknesses. Also, a friend won’t be afraid to be honest with you if, for example, you’re taking the business in a questionable direction.
Having a shared value system is one of the most important safeguards against failure, according to consultant Adelle Wapnick. “I’ve seen partnerships disintegrate because the leaders didn’t see eye to eye,” she says. In contrast, having a similar outlook means you will probably relate to customers and employees in much the same way—and so the building blocks of your friendship can become the foundation of your company culture.
work it out
There are, however, ground rules that must be put in place to ensure your “friendship/business partnership” works out. First, says Mjadu, it’s vital to formalize the relationship with a shareholders’ agreement or agreement of association. Many friends might think that their mutual affection will see them through the tough times. Not so: your relationship will change as the business grows, and you’d be surprised at the issues that arise. You might be angry about the way she handles the money, for example; she might not agree with your treatment of clients. These kinds of things should be addressed early on, and you should set out guidelines to help you deal with them.
While you’re doing this, decide who’s going to take the lead. As friends, it’s tempting to imagine that things will progress in the office just as they do when you’re out for drinks: that both of you will be equal and contribute the same amount. But, Mjadu
Ideas Happen because you’ve been talking about Something To a lot of people for a Long Time.
points out, there’s always a leader, even when the task is as simple as planning a bachelorette party.
The person at the helm isn’t necessarily the one who has made the biggest investment in the company; perhaps it’s the one who’s making all the tough decisions. Either way, it’s best to decide who’s doing what from the outset. Wapnick says you need to be careful that the people you partner with aren’t too similar—after all, it takes diverse skills to build a business. “All companies need different kinds of input,” she says. So if you come up with ideas while your friend is brilliant with numbers, you’re on the right track. It’s not just the business that could suffer if your competencies are too closely aligned. If one of you feels it should be her way or the highway—a situation that may occur if you’re experts in a similar field—arguments are bound to ensue.
Feeling that things just aren’t amazing between the two of you right now? Address it before it becomes a major problem, Wapnick advises. “We’re often very forgiving with our friends because it’s easier to let an issue go rather than have an awkward conversation. In business, this is the worst thing you can do. The issues don’t go away.”
Wapnick says it’s important to partner with a friend whom you see as an equal: if one of you is stronger than the other, you may start relating to each other as parent and child rather than as colleagues. Mjadu says it’s best to ensure that your friend is in a stable place before co-designing your brand. It may sound cold-hearted, but you need to look at how she handles her personal finances before you entrust her with your livelihood.
If she’s always moaning about her credit card debt, she might not be the best person to put in charge of your cash flow. “A personal crisis can take away from your friend’s ability to focus on growing the business,” Mjadu says. Of course, you can’t turn away from a friend in need. The best way to handle situations such as this, says Mjadu, is to agree to keep your business separate from your friendship. “You need to keep focused at work,” she says. “Remind each other that you’ve seen an opportunity and created your start-up to take advantage of it, not as a platform to sort out each other’s problems.”
She suggests setting up clear boundaries so that your professional and private lives are worlds apart. Wapnick agrees—because if you don’t agree to stop talking shop once you’ve left the office, it’s easy for your conversations to center on work, and that’s the quickest way for a close friend to become nothing more than a colleague. “Go into the venture knowing that your friendship is more important than the business,” she says.
pros and Cons
For Jane Rankin, chief executive officer of the Branson Centre for Entrepreneurship, the potential for a business partnership to ruin a friendship is the chief reason she feels friends and colleagues should remain separate— but, she says, it’s not the only one. “Entrepreneurs often make the mistake of going into partnership with someone who supports them and who they like, rather than someone who has real expertise,” she says. She also warns it’s difficult to be objective about someone you care for.
However, Rankin says one of the primary reasons start-ups fail is because an entrepreneur has tried to go it alone. It’s important to surround yourself with a team—but more than that, it must be the right team. Rankin’s suggestion is to be humble enough to bring on board people who are smarter and better at their job than you are, then make sure you’re all working towards the same objective.
One way to make sure everyone’s eyeing the same prize is to decide on your strategic approach upfront. It’s more effective to look to the long term, identifying potential problems and how the business may evolve as it grows, and to structure it accordingly. Things to consider include feedback you receive from clients and keeping an eye on what your competitors are up to.
There’s no doubt more and more people will turn to entrepreneurship. If you’re one of them, your team will be one of your greatest assets—and if your bestie can be a part of that team, wouldn’t that be awesome?
big MISTAKE: partnering with someone you like rather THAN someone with real expertise.
Friends forever... even in business?