Don’t let people paint your dream : Partnership

Business Partners, Uncategorized

Early in my career, I have no clear picture of whom I am looking for, I was with some people who weren’t the right fit. I allowed others to paint the picture for me. Invariably, they painted their pictures. Then I discovered that the pictures they painted of themselves had been greatly enhanced. They were like the glamour shots people take and then doctor in Photoshop. They weren’t authentic, and they didn’t fit into my dream.

Before a month or more I was hanging out in a group of some start-ups, Guys are screaming with their own Ideas, Vision, Productivity.

“Partnership” – I said, Finally.

Silence was everywhere. It was not they were expecting to here, but they got it immediately.

No one had a suitable answer. I explained little bit, What exactly partnership is from business dictionary

” A type of business organization in which two or more individuals pool money, skills, and other resources, and share profit and loss in accordance with terms of the partnership agreement. In absence of such agreement, a partnership is assumed to exit where the participants in an enterprise agree to share the associated risks and rewards proportionately “

“If you are with right partner, that will help you gain right momentum and realize your vision” – One said.

Better Choice

To find like-valued people, you need to know what you’re looking for. As a starting point, I look for people who embody these 12 qualities:
1.      Thinks about others first.
2.      Thinks bigger than self.
3.      Has a passion that’s contagious.
4.      Offers complementary skills.
5.      Is great at support.
6.      Possesses a can-do spirit.
7.      Has an expanded influence.
8.      Holds an activist mindset.
9.      Is a proven ladder builder.
10.   Stands out from the crowd.
11.   Creates teamwork.
12.   Makes a difference.

Keep Your Friends and Family Out of Your Business

Business Fails, Business Partners, Finance, Uncategorized

Involving third parties in relationship matters doesn’t solve your problem, it compounds the issue. If you discuss your private affairs in public, it is going to backfire. Managing relationships by committee condemns them to a premature death. The best approach is to allow time, patience and the human conscience a moment to work. Besides, only you and the person that’s involved posses the ability to actually solve your problem. Once you put people in your business, you never get them out. It’s human nature for people to hold on to negative preconceptions about people. This is especially true as it pertains to your friends and family when you immerse them in your relationship.

It’s better to keep your business to yourself, others just want to do you pain. 

Be wise and hold your mouth, the worst that will come out of it is staying the same. – morayo

There is an old saying, “A dog that brings a bone carries one.” In other words, people that have an eager ear to hear your business cant wait to tell it. Using your as the example, don’t you have at least one person you share information with? Other people are just like you! The juicier the gossip, the harder it is for someone to hold it in. There is a ninety percent chance that anything you say will be repeated to someone. Not only are you needlessly exposing your relationship to unnecessary scandal, you’re betraying your mate. Long after the two of you get past the problem, friends, relatives and those in your social circle will still be whispering about you and your significant others past issues. i.e. Don’t get pissed off at your relations when you put them in your business to begin with.

 So, you get it: Keep your business and personal credit separate. But how do you get started?

1. Establish your business as a separate legal entity.

This could be as a sole proprietor, LLC or S-Corp. Sit down with your tax advisor or financial planner to determine which legal entity fits your business and financial situation. Sites like LegalZoom and Rocket Lawyer can take care of the legwork. You just complete an online questionnaire and pay a small fee. The websites fill out the documents and file them with your state. You can receive your official formation documents in about seven to 10 days.

2. Set up a business checking account.

This keeps your business financials more organized and allows you to get a clear picture of where your money is going. It usually takes just 30 minutes to set up an account at your local bank.

Use the business account for all business-related expenses. When paying yourself, deposit the money into your personal checking account. Your business checking account also allows your business to use employee payments as tax deductions from income, while letting you show personal income for the purpose of loans, credit and taxes. Business lenders will want to see your bank statements to get a true picture of how you’re performing.

3. Build a business credit history.

Start by opening a business credit card and always paying on time. The business credit bureaus will add this positive payment history to the credit file dedicated just to your company. Unlike personal cards, you may be able to deduct interest from business credit cards. When applying for a business card, just be sure to verify that the card provider reports to business credit bureaus and not to personal ones.

One of the biggest mistakes new businesses owners make is relying on personal credit cards to fund operations. Not only do you take on liability, you can damage your personal credit. If you have a personal score of 800 and max out your cards, your score will drop below 700. A 100-point drop will definitely cause your odds of getting credit to tank. It’s that severe.

Along with getting a business credit card, you should also open credit lines with your vendors and suppliers. This is known as trade credit. It gives you extra time (net 15, 30, or 60 days) to pay for your supplies and services. Depending on what type of industry you’re in, you can open accounts with businesses like Office Depot, Staples, UPS, Home Depot, etc. These companies are usually willing to establish a small credit line for your business without reporting or checking on your personal credit information.

As you establish a consistent history of on-time or early payments with these suppliers, your business credit scores will improve. This will allow you to access even more credit with even better payment terms. It’s a snowball effect.

4. Monitor your business credit regularly.

After establishing healthy business credit, you’ll want to stay on top of it. According to the U.S. Small Business Administration, the credit score of 33 percent of businesses may decline over just a three-month period. That’s why your lenders and creditors reassess your company’s creditworthiness on an ongoing basis. If your credit deteriorates, terms can be adjusted or stopped altogether. Without notice, you could be forced to pay cash on delivery for your supplies in place of your normal 30 days payment cycle. Regular monitoring helps avoid these nasty surprises.

How To Recruit a Board of Directors

Board of Directors, Business Partners, Uncategorized

“To succeed in these times of breakneck change, companies will often recruit a board of directors to help them make more effective decisions and lead them in the right direction during stormy times. By consulting men and women of wisdom these organizations reduce the number of mistakes they make, boost corporate effectiveness and increase their credibility in the marketplace.
One client of mine has a difficult approach to the concept of having a board of directors. A seasoned entrepreneur and a participant in one of the monthly life coaching programs I conduct across the country, this woman told me that during her periods of silent contemplation, she sits in a room with a pen and pad of paper and writes down a problem that she is facing. Sometimes it involves a difficulty in a relationship, sometimes it concerns a money issue or at other times a struggle that is more spiritual in nature. ” – Taken from Who will cry when you die

One of the turning points in the life of an early stage software company is the creation of a board of directors. Typically, this happens when the company raises its first institutional round of financing. But I see no reason to wait for that event.

When you think about building your board, start with a clear realization of the need. Don’t create a board if you don’t need it. It is more likely that you do need it, but you don’t realize it.  So let’s start by discussing why you need a board.

A board of directors is a vehicle through which you can recruit super talented and experienced individuals who can add value by helping you make key decisions and ensure that you are implementing sound corporate governance.  Most founders/CEOs think that a board is something that creates a lot of unnecessary work for them, adds little value, and is manned by individuals who will get in the way of running the company.  That can be true if you recruit bad board members. But if you recruit great board members, you will get great value.

Recruiting a board starts by you realizing that you should recruit a board the way you would recruit employees. Start by defining your needs. One approach is to examine your skill sets as a founder/CEO (for more on that, read Mr. CEO, Would you Hire Yourself?) Then think about the skill sets you lack and where a mentor could help in the role of a board member (for example, if you’re weak in finance, a former CFO would be a good prospect). Then think about your plans for growing the company and the role of a board member in opening strategic partnership doors, whether for funding or business development. 

Next, put together a role description. Again, treat hiring a board member like you would treat hiring a senior executive. Putting the role description down on paper will help you hone in on exactly what you’re looking for, and will ease the recruitment process. 

Set clear expectations of the role. When recruiting an employee, it’s pretty obvious that it’s a full-time role. But when recruiting a board member, setting your expectations on the time and energy commitment expected in the role is key. There are many people out there who get on boards, but have no time for it, or don’t prioritize the role high enough. You also need to be realistic in your expectations. For expansion stage software companies, a board member should allocate a minimum of one day a month. Four of those days a year are for board meetings. The rest are to be spent with you diving into your operations, or helping you by opening doors and enabling business.

Get help in recruiting. You probably can’t afford to hire a recruiter. But if you can, hire a recruiter. Again, this is a critical role. Recruiters can help you dramatically widen the scope of your search to find the best candidate. In lieu of a recruiter, see if you can find someone experienced to volunteer to help you. Even if it’s your lawyer or accountant. Basically, you need another set of eyes to help you in the process.

Be highly selective. There is nothing more damaging than having a bad board member (same as hiring a bad employee.) A disengaged board member is a waste of your time and energy. A great board member can bring you great value. 

Put your board members to work. Board members should add value. But they will only do it when you ask them. Always be looking for the next project for each and every board member. When you run out of things for them to do, it’s time to let them go.

Know when to let one of your board members go, and don’t wait too long to do it.  Board members should bring value to you and your company. If they don’t, fire them, and replace them with those who do.  You typically don’t have that option with investor board members (although you may at your next round of financing).  But you certainly do when it comes to management board members (a co-founder that has outlived his/her tenure on the board); or independent board members.

Don’t create anything for the board that doesn’t add value to your business. Many founders/CEOs lament board meetings because they think the meetings suck up their time and bring no value. Well, that is a symptom of a bad board. Fix the board first. One you have a good board, make sure that whatever you create for the board (presentations, dashboard, etc.) are things you already are using for your business. 

Expose your board to the guts of the business. Board members can only be helpful if they understand your market, your business and your operations. If you feel the urge to hide things from them, you have a bad board. If you don’t think they would understand your business, you have a bad board. Fire them and then hire the right board. And then open up the guts of your business to them. Have your senior managers walk the board through each function. Expose the issues that you struggle with. Then ask them to help you resolve them. If they can’t, fire them, and find members that can. 

Warning Signs That Your Business Partnership Is Failing

business, Business Partners, entrepreneurs, Grow fast in startup, start a business, Uncategorized

You need to read these steps for good health of partnership. Because, A business partnership can be every bit as complicated as a marriage. And, like matrimony, some partnerships end unhappily.

Wouldn’t it be helpful if you could spot the warning signs of
an implosion before it occurred — or, better yet, before you even entered the partnership? That way, you could escape the situation before it turned ugly, got expensive, or wrecked what you’d built through long, hard work.
Actually, you can. Here are five signs that your shared business may be in trouble, so that perhaps you can rethink the partnership before it’s too late.
1. Unfair or Unbalanced Roles
Like a good marriage, a good business partnership brings together two people whose personalities, skill sets, intelligence, know-how, and other attributes complement each other. When properly balanced, the partnership produces a union that’s more powerful than either person acting alone.
But a successful partnership can’t happen or endure when there’s a fundamental imbalance. Trouble generally arises when one partner feels he or she has too much or too little:
  • authority,
  • responsibility,
  • time commitments, or
  • investment in a desired outcome.
The ideal situation is one in which each partner feels good about his or her contributions and the other partner’s efforts.
Of course, the requirements of a business are constantly shifting. So, a successful partnership needs not only an initial balance, but also a mechanism for re-balancing the partners’ individual workloads as often as necessary.
2. Financial Disagreements
Business is closely tied to money, and it involves making myriad decisions about spending, investing, receiving, and controlling funds. Some of these decisions inevitably are based on value judgements, such as whether you spend more in order to buy domestically-made goods or operate in a “green” way.

Spending much money without asking to your partners, hidden transactions, hiding clients payments etc. These are major issue in financial disagreement. 

cash flow is central to your business, significant disagreements about spending signal a fundamental partnership problem. As time goes on, there’s a good chance you will become dissatisfied with your partner’s preferences regarding money — and tire of your constant tussling over it.
3. Unresolved Issues
This is not important to see the world in same way as other partners do. May be there some likes and dislikes, agreed or not. Problem is to resolve them by talking much more about the issue.

Disagreements are not necessarily a problem, but difficulties in resolving disagreements are. Psychologically, the inability to resolve conflicts often signals basic incompatibilities in a partnership, personal dislike, or divergent worldviews and values. But even if all that stays in the subconscious background, difficulty resolving disagreements generally reflects important differences in communication styles, priorities, and personal flexibility, any of which can put extra pressure on a relationship.

From a business perspective, disagreements that continue for long periods produce resentment, waste time, and impede effective management of the business. So, make every effort to settle disagreements respectfully, in a way that recognizes the worthwhile aspects of each partner’s point of view. Ongoing friction is usually a sign the partnership will end badly.
4. Different Ways of Working
Differences in work styles can produce conflicts and resentments that steadily build up until the partnership falls apart. For example, one partner may:
  • rarely or never take time off, while the other partner cherishes regular “off hours”;
  • obsess over certain issues, while the other partner thinks them through to a suitable policy and moves on; or,
  • insist on volunteering their services for certain causes or decline certain business opportunities in order to reinforce personal values that the other partner deems irrelevant to the business.
The partners may begin with a good deal of tolerance for each other’s “quirks.” But fundamental differences are likely to chip away at even the strongest bonds.
5. Different Exit Strategies
How you plan to exit the business in the future can have a profound impact on day-to-day decisions and operating strategies. If partners are interested in divergent outcomes, they’re frequently going to feel driven toward different choices, such as:
  • taking cash out of the business early versus delaying immediate income in favor of investment toward long-term growth; or
  • running everything personally based on “gut feelings” vs. establishing policies and developing staff so that the business can run without the partners’ close oversight.
Individually, none of these differences create an immediate or inevitably fatal flaw in a partnership, of course. But they do send up a red flag in terms of the potential for long-term mutual satisfaction and success in the partnership, and the greater number of these problems that describes your partnership, the bigger the risk tends to be.