How to make your dreams come true and avoid any nightmares.
Thinking about starting a business with your other half? Sounds like a swell idea when you’re sitting on the couch together swapping daydreams. But there’s a lot to consider before you dive in. As if business ventures weren’t complicated enough, a professional partnership with your lifelong partner adds an element of complexity to the equation.
That being said, there are many couples who have built successful business empires. Think Chip and Joanna Gaines of the Magnolia empire or Will Smith and Jada Pinkett Smith, who own a production company together.
Here are some do’s and don’ts as you embark on this adventure with your spouse.
Do discuss risk tolerance. Because both of you will be relying on income from the business, be sure you have the conversation about what type of risk you’re willing to take and consider maintaining separate earnings records, employee benefits, and personal after-tax assets. Speak to your advisor about what level of risk your financial situation can withstand as well. It might mean one of you keeps a full-time job for a bit while helping the other run the business on the side.
Don’t be afraid to disagree. Challenging each other may actually contribute to business success and continued innovation. That is, as long as you and your partner are good at conflict resolution. The more ideas, the better. From there, work through the options objectively and come to an agreeable resolution. If there are some aspects you don’t agree on, consider dividing responsibilities to conquer.
Do separate work and home life. It’s really exciting as you build an empire and experience success but remember your relationship is more than just the business – so spend time together and avoid talking shop. Maybe it’s a hard stop at 6 p.m. every day so you can switch into home mode. If you run the business from home, it might mean keeping inventory in a specific room.
Don’t forget to give your partner praise. Joint success is what makes the business happen but both parties should feel like they’ve made significant contributions. Celebrate your partner’s wins and cheer them on along the way. It’s easy to forget how important it is to actively support each other when you’re working and living – and everything – together.
Do have individual interests. Just as it’s important to take time away from the business together, it’s just as important to take time away from the business (and your spouse) for yourself. Consider personality differences in this equation, as someone who’s an extrovert might be fed by outings with friends while an introvert may need alone time with a book.
Don’t do it if you’re not having fun. Sure, you have to make money and support your family. After all, that’s why you’re in business! But you should be having fun while doing it. If the business is putting too much pressure on your relationship and affecting family life, it might not be the right situation for you. Be aware of how it’s going and recalibrate if necessary.
A business venture – with or without your spouse – is an exciting journey. Bringing in an advisor to partner with you on making smart financial decisions for you and your family can be helpful. That way you get to do what you love most and embark on your entrepreneurial dreams with less worry.
If you’re thinking about embarking on an entrepreneurial venture with your other half:
- Talk about how differences in risk tolerance and personality would affect the business plan and operations
- Bring an advisor into conversations early so they can make financial recommendations that support your goals