Why You Should Treat Your Business Partnership Like a Marriage

Staying out of the divorce courts sometimes means getting a third-party perspective on disputes

Written by Sissi Wang

When Babak Barkhodaei started his company, SkyPrep, in 2012, he thought he made a wise decision in partnering with his brother Arash. “There’s immense trust and benefit in working with your brother because he knows your strengths and shortcomings and has your best interest at heart,” says Babak. However, despite the pre-established bond between the two brothers, their first conflicted started very early on.

Babak focused on sales of SkyPrep’s online training software, while Arash worked on product development. Babak recalls constant miscommunication and misunderstanding between the two sides. “We had so many conflicts,” admits Babak. ” I was thinking about growing the business, so anytime a person wanted a feature, I would say to Arash, €˜do it, do it.’ I was focused on getting business and didn’t consider the complexity of the solution. At one point, Arash just got really fed up.”

MORE SIBLING SQUABBLES: The 4 Cs of Conflict-Free Family Businesses »

Business partnerships are like marriages. They start out wonderful in the beginning, but there comes a time when disagreements can threaten the viability of the institution. In fact, there’s evidence to suggest that corporate matrimony is an even more delicate institution. Research tells us that up to 80 percent of business partnerships fail. Small business attorney Nina Kaufman believes business partnerships are more difficult to maintain because the parties involved don’t have the tools to solve interpersonal problems on their own. They, more than anyone, need a third-party perspective.

In SkyPrep’s case, the quarrels finally stopped when their third brother Sepand joined. Sepand became the new product manager, and understood the challenges faced by both sides. His role as neutralizer in the business put SkyPrep back on track and introduced an important exercise that the brothers now do whenever there’s a conflict.

MORE CONFLICT MANAGEMENT: 4 Steps for Fighting Infighting »

Instead of fighting over whose idea to pursue, they now have to defend their brother’s point of view so they can see each other’s perspective. The company has started to gain more clients as a result of these changes.

“You need someone outside of your business who can help you stay focused on the goal, mediate the difficult conversations, and identify the problems in the business that’s causing conflicts,” says Kaufman.

Kaufman says there are many unforeseeable issues in business partnerships that will test the partners. One major cause of friction is money; the business needs to be generating enough revenue for each person to maintain their lifestyle. When one partner’s lifestyle changes as a result of a marriage or the onset of a new family, the new situation will affect their thinking and create new demands in the partnership. The partners need to be able to work through the new requirements in order to stay together successfully.

MORE MONEY WORRIES: Do You Earn What You Should? »

However, when partners cannot work through the new situation on their own, that’s when a business coach or a third person who can act as a mediator can come in handy to help them see both sides of the situation and work through the differences. A business coach looks at the systems in a business and how things are functioning, then provides their advice on the issue.

Just as it’s wise to talk to your significant other about your spending habits to make sure the two of you are aligned before you tie the knot, Kaufman advises business partners to have an open and candid discussion on all aspects of the business from money to work division and exit strategy before they go into a partnership to avoid problems in the future.

MORE EXIT STRATEGY: How to Break Up With Your Co-Founder »

“If you know from the onset that there’s these criteria to be reached, then there’s less personal animosity that comes out later on,” explains Kaufman. “They won’t experience disagreements as a personal attack, it’s just business.”

Kaufman also suggests testing the partnership beforehand to see whether someone’s a suitable long-term partner. Observing how your partner reacts to new environments and situations, for example planning a speaking event or collaborating on a new client together, can give you hints on how well your partnership will work in the future, says Kaufman. Figuring out your partner’s workstyle and whether they are self-motivated and accountable is very important to ensure that the partnership is a good one.


How do you resolve disputes with your partner(s)? Share your experiences and strategies using the comments section below.

Originally appeared on PROFITguide.com