Their blessings and hazards abound, so here’s how to make the right choice for you
A partner must be more than your big brother. He or she should have skills that you lack.
BY JACK LANDER
If you plan to produce and market your invention, one of the most important considerations is whether to have a partner.
I have started a number of businesses, two of which were with partners. I’ve also worked for partners and have witnessed partnerships form among inventors.
First, let’s examine three essential purposes for having a partner.
- To support you psychologically;
- To support you with complementary skills;
- To support the needs of the business for cash or other tangible contributions.
Think long term
By supporting you psychologically, I mean to restore your confidence if and when you have doubts, and help find solutions to problems that cause discouragement.
I suspect that most of us take the first steps in forming a business with enthusiasm and confidence. But somewhere along the way, we may encounter a difficulty that causes us to doubt whether we had made the right initial choice.
It’s comforting to have a partner with whom you can share your doubts and who may be more objective about the difficulty. A bit of doubt now and then is normal, and shows that we are prudently cautious. But too much doubt can squelch your dream.
A partner must be more than your big brother. He or she should have skills that you lack. My experience had taught me that most highly inventive people are short on the knowledge, interest and will for marketing.
Among inventors, a product in search of a marketer is far more common than a marketer who is looking for a product. The latter is called an entrepreneur.
If you lack the skill to design your product, including selection of the most appropriate materials, you can hire an industrial designer. Once the design is completed, you no longer need the industrial designer. But marketing is an ongoing challenge.
Partner with a person who will be valuable to your business mission for the duration of your business, not for a short term.
Tales from experience
Several years ago, I started Shortrun Precision Fabricators in Laverne, California. We produced prototypes and small production runs of precision sheet metal components for the electronics industries in the Los Angeles area.
I needed more cash than I had in order to buy the essential machines, pay the two-month rent advance, and have enough left over for raw materials. A friend of my sister’s was a bright fellow, mechanically inclined, and he had money to invest. So it seemed the best solution was to take him in as a partner, rather than give up my dream.
We worked together for about a year. I had taught him the fundamentals of producing, but when it came to starting a work project he froze. He appeared to lack the ability to decide the first step and dive in. And his fear of making mistakes impeded his ability to complete a job after I showed him how to start.
Coincidentally, a fellow engineer with whom I had worked previously was out of work, and stopped by to say hello. I didn’t hesitate to ask him if he would be interested in buying out my then-partner if he were willing to sell. The three-way transaction occurred peacefully, and I had a new partner who duplicated many of my skills. Not ideal, but it worked well enough.
Thinking back on my problem, I should have searched for a marketing-oriented partner—an entrepreneur. The entrepreneurial mind is typically focused on organizing, measuring vital signs, and marketing. The entrepreneur is not nearly as sentimental about the product or service as most inventors are.
Entrepreneurs seek the feeling of accomplishment from making a business successful. It’s typically not greed that drives them but the accomplishment, like winning a game of chess—although there are exceptions.
Creative people often fall in love with their creations.
A neighbor of mine invented a hardware item that filled a niche for the construction industry. He tried for many years to work a full-time job and produce his invention.
Meanwhile, his family suffered from his dedication to the development of his invention, even when he was home. They lacked ordinary comforts due to his diverting of employment income into his business.
At one point, he had licensed his patent in order to stop producing and collect royalties. However, he had written his own license and had not had it reviewed by a lawyer.
About four years passed, and the licensee had failed to produce the item. My friend asked for the license back on the basis of nonperformance of the (verbal) understanding that the item would be produced within two years. In the end, he had to buy back his rights for $25,000, which he obtained by taking a second mortgage on his home.
I ran into him in The Home Depot one day many years later and he was still struggling—making and selling a small volume from his basement shop—but the venture was nothing I would consider a practical success.
Another person I know invented a woman’s laundry product that she insisted on producing. She struggled for several years, selling her product all over the world, but never in enough volume that she could earn a living. Her husband supported her and her business, always hoping that one day they would get a break.
I advised her that she must take on a financial partner to get the $150,000 she needed to take the next major step, which would get her product into a certain chain of retail stores that wanted a version of it. She could easily have made the new version if she had the money.
She steadfastly refused to dilute her equity. Now, 26 years later, she is still selling at a low volume, barely paying the overhead.
So, you see why I am convinced that although partners are often a pain in the butt, the right partner is still the catalyst who may make the difference between a successful business and a break-even hobby.
Choosing the right fit
How do we find the ideal partner? I suggest you start by dividing a sheet of paper into three columns:
- My skills;
- Tasks I hate to do, or for which I lack the expertise;
- Tasks I like, or at least tolerate.
From this personal inventory, prepare a resumé for the ideal candidate who will become your partner. Now, convert the resumé to an advertisement. Highlight only one or two of the essential skills needed, and post your ad. Any place that has a public bulletin board might work.
This process may seem identical to looking for a lost dog. Your search may be inconvenient, but this is no time for shortcuts and impatience.
Use your email for contacts. Ask for a resumé. Also, prepare a brief business plan for your business or proposed business; two pages should be a practical limit.
Don’t get into sales or income forecasts. (These are signs of a dreamer or amateur.) Conclude with the main qualities you’re looking for in a strategic partner. The word “strategic” emphasizes that you aren’t merely looking for finance, in which case you would state “financial partner.”
You’re not a boss searching for an employee; you’re searching for an equal partner. In exchange for the qualities you need in a partner, you are offering your complementary qualities that are of equal value.
One of your main initial concerns is that you are probably looking for someone who lives within a practical commuting radius. It’s not likely that a potential partner located a thousand miles away will uproot and move for a risky startup opportunity.
But if you are further along in your business development and can prove its growth potential, websites such as powerlinx.com may produce results. Another site that looks promising is press.farm/10-best-websites-to-find-a-co-founder-for-your-startup/. I haven’t checked out these websites except to be sure they are still reachable, so be cautious.
A lost dog has four legs, a tail, and it barks. I assume that you have two legs, no tail, and you talk. There’s a kind of analogy here to your search for a partner.
The words “complementary” and “complete” come from the Latin word complere. You are searching for the partner who has the skill sets to complete your startup, the qualities you lack.
It may be a stretch, but I’ll call this the lost-dog principle. Easy to remember, right?