Three Ways To Avoid Being Stuck In A General Partnership From Hell!
Entrepreneur remember “how” excited and enthusiastic you were, when you and your partner(s) first opened your business! Remember “how” you couldn’t wait to see what or where the next challenge(s) were! But somewhere along the way your business drifted into a general partnership from hell!
And now instead of you looking forward to aggressively addressing the many perplexing (and constantly) changing challenges in business. Instead -now-you’re desperately looking for a viable exit strategy! Vowing never to go down this road again! Unfortunately,it happens far more often than you might think!
Three ways To Avoid Being Stuck In A General Partnership From Hell!
Entrepreneur, believe it or not, one of the (all too) common occurrences is, let’s say four of you have a general partnership agreement in which you each have a 25% equal ownership interest. And things are going relatively good, until one partner unexpectedly dies and their 25% ownership interest passes to a spouse or significant other and guess what?
Not only can you not stomach the spouse or significant other! But their suddenly making unreasonable demands, on top of being clueless about “how to” actually run a real business! The remainder of this post is dedicated to (hopefully) preventing this type of all too common mishap from ever catching you by surprise again!
1.) First: Let’s say two equal ownership partners (unfortunately), can’t agree on the future direction of the company, and whined up in court! A simple -yet- powerful provision in their written agreement would have allowed for an independent third party mediator/adviser to help them become un deadlocked! And perhaps a secondary provision that allows the partners to offer to buy each other out!
[cpm-player skin=”classic-skin” width=”100%” playlist=”true” type=”audio”] [cpm-item file=”https://www.youcanmarketonlinenow.com/wp-content/uploads/2018/03/If-youre-not-strategically-building-the-back-end-of-your-business-youre-leaving-money-on-the-table.mp3″]If you’re not strategically building the back end of your business you’re leaving money on the table[/cpm-item] [/cpm-player]
2.) Second: As previously discussed, one partner unexpectedly dies, and they’re clueless spouse/significant other and or kids, suddenly emerges as your new (and totally) unwanted legal partner! Since you hadn’t bothered to include a “buy out” provision in your paper work, in the event of death of a partner or major legal disability. Otherwise you whined up in court litigating a costly buy out settlement!(That may take a while and cost you a ton of money!)
Or if a partner(s) desires to sell ( part of or all of ) their ownership interest to an outside third party, you may wish to include some type of “first right of refusal clause.” That way, you and the other partner(s) at least have the opportunity to buy (or at least bid) on the partnership percentage that’s for sale.
3.) Third: Legal business partners with equal ownership interest, always need to keep in mind that a successful partnership is just like a solid marriage. It’s not a one night stand! Think long term when it comes to “who” you enter into a general partnership agreement with! And make sure you spare no expense upfront when it comes getting solid legal advice!
And you’ll nip about 75% of your potential legal problems in the bud! Don’t you agree?
Please list at least two simple spin off concepts (in the comments section below) that you can apply to your business, product or service in the next 30 days or less!
Forming Partnerships Can Be A Good Thing! (Just Don’t Get Entangled In The Wrong Ones!)
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