In today’s world, the concept of entrepreneurship has really taken off. Back in 2016, there were 25 million Americans who were planning to start or were already running their own business. Worldwide, there are roughly 582 million entrepreneurs, all determined to have a formidable impact with their big ideas. But, of course, most of those individuals don’t do it alone. Business partnerships are incredibly common, allowing people to join forces and work towards a common goal.
If you have a killer idea and are determined to create your own business, it might make a lot of sense to team up with someone you already know and like being around. But just because you get along with your BFF, does that mean it’s a good idea to go into business with them?
The real answer is: it depends. Statistics show that up to 70% of business partnerships fail. And according to Harvard Business School research, business partnerships that involve friends have been shown to be the most unstable. In fact, the founder turnover rate among tech-related businesses with friend partnerships was revealed to be nearly 30%. Additional research from Harvard University also suggests that business partners who share a lot of personal characteristics — like you might with your best friend — might be less successful.
That doesn’t mean, however, that you should never become business partners with your best friend. In fact, many experts in the field advise that you can ignore this conventional wisdom if you and your BFF have complementary traits (i.e., you each bring something new to the table and can balance out each others’ strengths and weaknesses). It’s also important to evaluate your relationship honestly before entering into business together. For example, if your best friend has a strong work ethic, shares your values (like trust, honesty, and integrity), is an excellent communicator, and has the same business goals you do, this could bode well for a partnership. Conversely, if your friend has issues receiving feedback, lets their ego get in the way, can’t seem to compromise, or has no sense of follow-through, you might want to think twice before you embark on this professional journey together.
Even the best of friends will need to think and plan carefully before taking this monumental step. You’ll want to clearly outline your roles from the beginning so that operations run smoothly and that there’s no confusion or resentment as time goes on. You’ll also want to establish how and when you’ll communicate and ensure that you can approach both the tough and the simple topics without fear. Setting boundaries will also prove imperative for BFFs who are also business partners, as discussing work during a casual get-together can create problems in both the venture and the relationship as a whole. Make sure you and your business partner are able to compartmentalize emotions when necessary to reduce the risk of taking things personally. This can be a tough one, but both partners need to have a shared understanding and are comfortable with this point before going any further.
In general, starting any kind of business is never easy. And while forming a partnership might make the process a bit less overwhelming in some ways, it can conceivably complicate mattes in others. By setting clear expectations and keeping the lines of communication open, however, it’s entirely possible that you and your best friend could launch a highly successful business and be as close as ever.