December 22, 2014

13 Questions to Ask a Potential Business Partner

interviewing a potential business partner

If you don’t like (or at least respect) your business partner, things can only go downhill from there. Just as you would screen potential employees, you need to make sure that you and your future partner agree when it matters most.

But how do you find out if it’s a match made in heaven early on? What questions can you ask when interviewing a potential business partner to ensure you’re doing your due diligence?

We asked members of the Young Entrepreneur Council (YEC), an invitation-only organization comprised of the country’s most promising young entrepreneurs, the following question to find out:

“What is one question you should absolutely ask when interviewing a potential business partner and why?”

Here’s what YEC community members had to say:

1. What’s Your Deepest Goal?

“If you’re going to do business with anyone, you need to get clear on the why. Knowing where you’re going is great, but if you don’t know why you’re both going there, then you’re screwed. Always start with why, and let the circle expand from there.” ~ Jonathan Mead, Playbook

2. How Much Do You Plan on Working?

“It’s easy for partners to overlook the amount of work it takes to make a business successful. The reality is that you should plan on working 40 to 60 hours a week on a startup. If one of the partners doesn’t plan on working that much, he better be very good at what he does and extremely efficient. Otherwise, it’s going to cause all types of problems. ” ~ Dave Nevogt, Hubstaff.com

3. What’s Your Exit Plan?

“It’s vital to know what motivates your co-founders and what their “end game” is. Some may be motivated by financial goals, whereas others are interested in the idea of running a business and growing teams. Communicating that ahead of time will go a long way toward identifying everyone’s strengths and weaknesses while building a business relationship. ” ~ Tyler Arnold, SimplySocial Inc.

4. Which of Our Skills Overlap, and Which Ones Differ?

“It is critical to understand where you and your business partner’s skill sets compare and differ. In my experience, the best business partnerships are ones where the partners have complementary skill sets, but understanding where the overlap occurs is important, too. Having a deep understanding of each person’s strengths and weaknesses will help when it comes to dividing tasks and collaborating.” ~ Doreen Bloch, Poshly Inc.

5. What Motivates You?

“What motivates you? Unless you understand that about someone, it will lead to misalignment and frustration.” ~ Panos Panay, Sonicbids

6. How Would You Handle a Media Crisis?

“This is one thing that many entrepreneurs fail to plan for or even consider. We have controls in place at my business so that one doesn’t occur, but I want to know that we’ll have a fast and relevant response if one does occur.” ~ Andrew Schrage, Money Crashers Personal Finance

7. What Happens if Something Goes Wrong?

“Partnerships are great when everything works out as planned. But what happens when things go wrong? How will they react? What do they care most about? What resources are available if necessary? Whether it’s an investor, a reseller or development partner, you should understand how they will react under duress and what milestones you can put in place to detect problems early and react promptly.” ~ Trevor Sumner, LocalVox

8. Have You Done It?

“Have you had a business partner before? I think it is a rare person who can truly understand what it takes to start a business or run one with someone else. Until they have done it at least once to see the pluses and minuses, I have a healthy concern for us.” ~ Sam Saxton, Salter Spiral Stair and Mylen Stairs

9. Do You See What I See?

“If you’re going into business with another person, you have to make sure that you’re both trying to lead the company to the same place. Otherwise, you’ll end up pulling against each other in a tug of war that no one can win. Ask a potential business partner to define his short and long term vision and goals.” ~ Nick Friedman, College Hunks Hauling Junk and College Hunks Moving

10. What’s Your Vision of Success and Failure?

“Business partners are often in agreement about the work that needs to get done and the direction the product should take. But they don’t bother to talk specifics when it comes to success and failure. Ask a potential business partner to clarify what success in the business would look like (specific revenue targets or valuation/sale amount) and what failure looks like so you’re both crystal clear.” ~ Susan Strayer LaMotte, exaqueo

11. If You Didn’t Have to Work, What Would You Do?

“This is a simple question that can tell you a whole lot about a person such as their passions, interests, drive and motivation. Our differences are what makes the world go round, which can also make for a very successful partnership (as long as your passions, priorities and what excites you are in harmony with one another). ” ~ Rebecca Zorowitz, Ooh La La Candy

12. What’s Your Main Priority?

“It’s important to have a business partner who is willing to invest just as much of their time into the business as you are. So, it’s imperative that you find out how much of a priority this business would be in their life, which should show you just how serious they are about it and how much of themselves they will commit. ” ~ Steven Le Vine, grapevine pr

13. How Do You Handle Bad Situations?

“You need to understand how your business partner will act if it doesn’t go as planned. How have they handled bad situations in the past? You want to make sure you’re partnering with a rational, reasonable and respectful person.” ~ Chuck Cohn, Varsity Tutors

Talking Photo via Shutterstock

7 Comments ▼

The Young Entrepreneur Council


The Young Entrepreneur Council The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world's most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

7 Reactions

  1. #2 is very important. You don’t want to go into a partnership with you doing almost all of the work. It is a partnership. You should work together to fulfill your goals. Although this can be sacrificed if the company has a huge network that you can tap, work must almost be equal for the sake of your team.

    • I agree that it is extremely poor that all parties in a partnership, know-how, monster, going to work breaking it down by hours can be unfair. The reason this is so is because one person may be responsible for a particular aspect of the business (say, inventory) which some weeks may require twice as many hours as other weeks in order to get done. In addition, so only get so good at the job that they can do the tasks in half the time it used to take in which case they’ll be doing the same job but working less hours, which might seem unfair to the person who is still plodding along at a slower pace then the other partner.

      Ideally, you want a partnership with someone who is as interested in successes you are but some people simply cannot afford to devote as much time as, say, a younger single person with no family responsibilities can put in.

  2. Love these types of lists and these are some great questions from some great sources. My first busienss was successful from a money making standpoint but unfortunately the partnership failed. Answering some of these questions up front and thinking through wether or not we really wanted to work together would have potentially saved me a lot of time and heartache.

    I was surprised to learn after that experience that the majority of business partnerships do not work out and that this is a major cause of businesses that are otherwise successful failing. This is why I think in addition to making sure you are clear on the goals, aspirations and work ethic of each partner its also important to put together a well thought out partnership agreement. In addition to having a document in place if things do go wrong, working through the questions that come up when putting together the partnership agreement is also a great way to make sure everyone is on the same page.

    Best Regards,
    Dave

  3. “This is one thing that many entrepreneurs fail to plan for or even consider. We have controls in place at my business so that one doesn’t occur, but I want to know that we’ll have a fast and relevant response if one does occur.”

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