Pitfalls of Having a Partner in Your Online Business
Do you have a business partner in your online business?
I had the wonderful opportunity to undergo a course of study under a proven established online marketer before I went full time as an online entrepreneur. I was on Lesson 1 when I was shocked to read that my mentor advocated NOT to have a business partner in running my online business!
Among other factors, my mentor singled out:
1. differences in focus and priority as business develops - it is very hard to have both or more partners to have an intense focus on the businsess especially if the business is growing or there are material developments affecting the business. There are pull and push factors, and as each individual behaves differently, the response and appreciation of the difficulties and growth of the business is different. Problems grow when different individuals exert their own influence in business decisions and fail to work cohesively.
2. inability to increase capital or move together in financial decisions - when a business grows, and there are financial outlays affecting the growth, or where business deicisons involve capital expenditure, there is seldom unanimous agreement on major issues pertaining to money. This is especially true of online businesses, where capital outlays and expenditures are perceived to be low, and when action is taken to do offsite promotion or offsite related business activities which involve heavy expenditure, the online entrepreneur has to be confronted with the glaring difference of low cost online business and that of a brick and mortar business which involves capital expenditure.
3. Dilution of authority of founding members- as the business grows, the founding members will find less incentive as their hold or control over the business will be diluted, as the CEO will take on a higher profile, eclipsing the others such as the Vice President. This leads to attendant problems of the Vice President feeling being left out of the management loop, and especially where foreceful characters are in play, conflicts will start.
I have personally seen this working out in an established online business, and the picture is not healthy.
Therefore, any online business if structured properly will have the centers of influence on just one person or cohesive group, with other players contributing as affiliates, or participants whose "advice" is listened to but not necessarily followed. If this cannot be avoided, it is imperative for the partners to have a buy-sell agreement at the very onset of the online business even before the busines starts to grow. Such buy-sell agreements will allow the more aggressive partner to have the first priority to take over the other partner's share of the business at pre-determined and fair conditions. Without such a saving technique, any online business will see a period of attrition, and members bewildered and leaving in droves as more problems arise to the surface as business partners flog their differences in the open.
Peter Lim, Certified Financial Planner is also a full time online entrepreneur, and write often on financial articles and investment articles. He is the author of Swing Trading for Gigantic Profits (http://signaldot.poolofwisdom.com/swingbook.phtml) and has a online website offerring free resources for anyone aspiring to be a profitable trader in the stocks and futures markets at http://www.online-guides.info/Swing-Trading
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