A contrary view on getting into business with your friends
As is the case with every post on this blog, I can only speak from my personal experience. But in my experience, getting into business with friends is the best way to do it.
I started my first company (Spunlogic) back in college with two of my best friends. We were such good friends that we were all groomsmen in each other’s weddings. We added a fourth partner about 5 years later and today he’s also one of my best friends. We went through the tough times of starting a company with no revenue and no real prospects for success, all the way to selling our business and working together at the acquiring company (Engauge). There were intense debates, huge disagreements and difficult decisions, but we remained tight and are still great friends today.
Along the way, one of our employees became one of my closest friends and a year ago today, he and I started a company together (Dragon Army) along with another friend of mine.
When I look back at my time at Engauge, it was only after I was able to create a special friendship with several of the other leaders that I really started to enjoy myself and we started to have real success.
I’ve written before about how a partnership among friends can work. And of course, some people should not work together because they aren’t compatible in that way. I get that. But I can’t imagine doing it any other way and I’m thankful for the friends that have put up with me joined me on these adventures.
Why should you consider getting into business with friends?
You’ll have a huge head start on communication. This is of course assuming you communicate well with your friends ;)
Common values. There’s a reason you are friends and it probably has something to do with having common values and shared experiences.
Trust. There will be disagreements and tension along the way, but when you trust someone it makes starting a business so much easier.
You’ll have more fun. Tough times will come when you start a business and there’s no escaping that. But along the way you’ll have more fun (and therefore, more energy and passion) if you’re working with people you truly enjoy being with. And the great times are even that much greater.
My first partners: (me), Raghu, Raj, Danny
My next partners: David, Ryan, (me)
A former employer, MBNA, took what was then a contrary stance on hiring friends and family. At the time, most companies forbade this per “nepotism” rules. MBNA was one of the first to realize that smart, hardworking people tend to be friends with or be related to other smart, hardworking people. In addition, if there is a bond outside of the workplace, it likely means that there is compatibility, and that when the inevitable tough times arose, the broader relationship would help you to power through them. Your experience with friend/partners is a nice corollary.
Del, this is a terrific point. When people who know each other well end up working together, they often have better communication and know how to collaborate. But your point to about nepotism is something I hadn’t considered, thanks!
BTW, even MBNA had a rule about family members reporting directly to family members (not allowed), but if the overall culture is accountability for individual, team, and collective results, you can effectively guard against people referring friends and family members who will not perform well.