Fill in your details below and one of our friendly consultants will call you back as soon as possible.
  • This field is for validation purposes and should be left unchanged.

Follow us on Twitter

  • RT  @UpriseAfrica : The  @DrifterBrewing  #EquityCrowdfunding campaign has reached the 2 MILLION mark ! Not long to go till the campaign closes… 1 hour ago
  • RT  @TheLaunchLab : LaunchLab Company,  @MzansiGo  started with 1 crew 12 months ago. Now they have more than 20 moving crews, and the income o… 1 hour ago
  • RT  @SABEntrepreneur : Want to know more about the Africa Sustainability Challenge launch and how you can enter? Join our live #TwitterChat o… 1 hour ago
  • RT  @shanak : #Repeat and agree :) happy Monday to all :) https://t.co/vo0qpb0cDj 2 hours ago
  • - Monday Motivation - Have you set out your goals for the week? Make your Monday count. #MondayMotivaton… https://t.co/BzgAF7OD20 5 hours ago
  • RT  @NeoNdaba_ : The behaviour displayed by supporters is disgraceful, and provides a snapshot of how our characters and values may have dege… 1 day ago
  • RT  @Entrepreneur : If all your accountant does is make sure you don't get audited by the IRS, it's time to find a better accountant. https:/… 1 day ago
  • RT  @RickEdBusiness : Great team making great strides with putting together 2018 Creative Business Cup and Creative Enterprises Hub https://t… 2 days ago
  • RT  @LaurenSCochran : Dear people cold emailing #familyoffices and really just about any organization, don't address the email to the one man… 2 days ago
  • RT  @RickEdBusiness : Why is it so difficult for so many #Techpreneurs to get their heads around this so obvious truth! https://t.co/7WCjHb4p… 3 days ago
  • RT  @innovsummit : Calling all female biosciences entrepreneurs!! The deadline to apply for the 2018 FEMBIOBIZ Acceleration Programme is toda… 3 days ago
  •  @Ventureburn  Seriously? More talking about getting together to talk about a solution for small business! 3 days ago
  • RT  @innovsummit : Pitch Your Business Ideas in  @TheLaunchLab  Ideas Programme! https://t.co/6EUuhthlPi 3 days ago
  • RT  @TyronneNel : #SME Advice - Aside from the (potential) money, the (imaginary) freedom etc. that you think you’re going to earn as an entr… 3 days ago
  • RT  @TyronneNel : #SME Advice - Dear entrepreneur, an App is not a business! If you’re not solving a real world problem NO amount of technolo… 4 days ago
  • RT  @Edge_Growth : In the words of our Executive Director (Jayesh Nair): "Supporting and developing #SMEs is one of the best ways to stimulat… 4 days ago
  • RT  @TyronneNel : Full House tonight! #StartDbn Well done everyone for showing an interest https://t.co/PpKLd2iIAv 5 days ago
  • RT  @TyronneNel : #StartDbn - “You can’t get good money from a bad VC” - Solid advice  @darlenemenzies  5 days ago
  • RT  @TyronneNel : Looking forward to  @StartupGrindDBN  tonight! Expecting pearls of wisdom from  @justinclarke   @darlenemenzies  and  @aishapando … 5 days ago
  • RT  @TyronneNel : Is the #Durban SME Ecosystem finally starting to rear it’s head? #StartDbn making a meaningful impact. https://t.co/d9EvDLf… 5 days ago
 In News

Partners and your businessSo, you have been operating for a while now and are considering bringing on a partner because you realise that you are unable to achieve your objectives on your own. The problem is, you don’t know where to start and after all the horror stories you have heard, you are a little hesitant to say the least.

Well the good news is, providing you do it correctly, bringing on a partner should be no more difficult than concluding a sales contract with a client.

Most often, we bring on business partners because we need the additional capital to grow our businesses or because they possess a skill we need but cannot afford to hire in the market place.

When looking for somebody who meets your requirements, it is important to ensure that you get along with them on every level because your individual personalities will play a large part in how the business is run, clashing personalities are very often the cause of many business failures.

Once you have found the person to you feel is most suitable for you and your business, it is important for you to prepare a shareholder (Companies) or membership (Closed Corporations) agreement. This step is very important and should not be overlooked as it will be very difficult to prepare one after the fact.

In preparing your agreement it is important to write down all the potential issues both of you feel might get in the way of running the business. Below is a list of some of the more common issues we have had to deal with:

Shareholders – It is important to be clear who owns the shares of the business as the agreement is between these parties and not necessarily individuals.

Ownership Percentage – Be very clear as to what percentage each shareholder owns?

Object of the Business – You need to state what the business does.

Loan Accounts – How are there to be treated in the business?

Death of a partner – How will the shares be treated if you or your partner die?

Key Man Insurance – Will the business be taking out insurance on the lives of the partners?

Conflict of Interest – it is important to ensure your partner is dedicated to the business and not pursuing other interests.

Directors & Chairman – You need to be clear as to who can appoint Directors and who will be the Chairman.

Deadlock – It is important to stipulate what course of action will be taken if the Shareholders find themselves deadlocked on an issue.

Dividends – What percentage of the profit will be paid out as dividends?

While the above list does not cover every eventuality, it is a good place to start when you are having your discussions. Good luck.

Recommended Posts

Leave a Comment

Start typing and press Enter to search

How is it possible that you are making profits but do not have any money in the bank?What is a legal tax invoice?