In today’s highly competitive business climate, startup entrepreneurs want to pursue their most ambitious goals with people they trust.
Have you considered co-founding a new business with family or a friend? If so, you’re not alone. About half of all startups today are organized among friends, family members or spouses. It makes sense, too, because in today’s competitive business climate, startup entrepreneurs want to pursue their most ambitious goals with people they trust.
However, when working with friends, expectations of loyalty and understanding are higher than is common among everyday work colleagues. And when friends let us down, resentments can linger and cause a deep divide in both work relationship and personal relationships.
Here are five ways startup misunderstandings can spiral out of control and potentially end friendships, according to Fox Business.
#1: Unmet Expectations. The typical startup business will take a lot more time and money to become profitable than anyone ever expects.
#2: Work Style Conflicts. Even though friends get along great when hanging out at the bar, this compatibility may not resonate in the office environment.
#3: Business Strategy Disagreements. New startup partners tend to be well aligned to the grander goals of an organization, but rarely have worked through the nitty gritty details of how to achieve these goals.
#4: Spending Conflicts. One of the most common areas of disagreement is spending authority and budget priorities.
#5: No Way Out. What happens when one partner wants to sell out, quit or reduce involvement in the business?
A recent Forbes article, titled “Co-Founding With a Friend - - Without Decimating a Friendship,” shares a few words of wisdom from successful businesses founded by friends. One startup says “when making decisions, we make the conscious decision to not be disrespectful because at the end of the day, we want to stay friends.” Another startup recognizes the importance of keeping work and personal lives separate.
In short, to avoid these business and friendship ending misunderstandings, it is important to discuss all issues that might interfere with productive business building.
References: Fox Business (June 13, 2011) “Why Co-Founding a Business Can Decimate Friendships”
Forbes (December 12, 2012) “Co-Founding With a Friend – Without Decimating a Friendship”