One business partner feels they are “doing all the work”. Or that the deal wasn’t fair. Or they see a short term opportunity and leave the current business partner for it.
A business is a longer term game. Almost none of the businesses you know of today came overnight. So you also need to ensure you go into the longer term business with both parties being happy with the deals they are getting. Best practice on internet is usually 50-50 or if there are four people 25-25-25-25.
Business is psychological. Does 51-49 really make a big difference when you make a million dollars? Or for that matter even if you make only a hundred dollars? Besides from stroking the ego of one of the business parties, it doesn’t. Either the business will make a ton of money and in which case you both will be happy. Or it won’t work, in which case that extra percent or ten percent won’t matter anyway.
If you are learning to negotiate, they will teach you to ask for demands at the last minute and as the party is desperate to close the deal, they are more likely to agree – rather than if you had asked in the beginning.
This though, in my humble opinion, is not going to work in the longer term. When one party feels they got the “shorter end of the straw” they will do their best to sabotage the deal – even if it is unconscious. They might subconsciously try to do only 49 % of the work rather than doing even more than you.
No contract is air tight. There are almost always ways to get out of it. Especially as we get into an economy which is more “intangible” (knowledge economy), there are less assets to fight over. If one of my deals does not work out – will my business partner take 14 % of my brain out? Truth is from all the business deals, the winners are those that make the business happen. Besides the money, you get the experience, contacts and the rest of the often under appreciated benefits of going into business.
If you are getting into business with someone, figure out if you could work with this person in the longer term. If they are a team player or if they are “me” driven. And if your values align. Are they aligned to the same mission as you? Those only in it for the money are going to give up as soon as the money arrives or go into something else when the money isn’t coming as fast as it should. You don’t want to get into business with partners that will quit working when they make their first million dollars.
Often times, I will take the “shorter end of the stick” just to make the deal happen, knowing that I would rather keep the other party happy than go into a deal that the other party is not happy with. When you adapt the “abundance” mentality of an entrepreneur you will get into more deals than when you have the “scarcity” mentality that the structured world has taught us.
School taught us that there can only be one “top” graduate. Corporations have a limited number of promotions available. There is only one person that wins a tennis tournament. So we have grown up with the “either I win or the other person wins” mentality rather than the win-win attitude that Stephen Covey preaches about and you will appreciate as an entrepreneur.
In the trustonomy, you need to build trust and partners for the longer term, those fighting with you for the percentages even before the business are off the ground might not be worth going into business with.
We live in the greatest time in history where we all have so many choices and people we can work with – remember that there is always the “no deal” option and going and doing something else rather than something you are not happy with.
Business will consume so much of your life. And if you are working and doing things that you feel are “unfair” or working with people you don’t enjoy working with than you are taking away time from doing what you love to do and people that you respect working with.
Don’t let greed ruin your longer term success.