Avoiding Pitfalls When Partnering with a Friend.

StartupJournal, The Wall Street Journal Online
Kelly Spors

Question: A friend and I are going into business. How do we structure it so if things go sour, it won't destroy our friendship? Answer: Business partnerships are more like marriages than most people realize going into them, and they frequently end in bitter divorce. But it's especially heartbreaking when a friendship is lost along the way. Prospective partners need to acknowledge that conflicts will arise in a business relationship, and they should set guidelines for how to deal with every kind of potential unsavory scenario, says BMC's David Gage.

Want a business partner for life? Get a prenuptial.

Washington Business Journal
Jennifer Nycz-Conner

The author explores the risks that face new and potential business partners as they create their critical partnership relationship. Nycz-Conner focuses on the Partnership Charter as a tool for getting off on the right foot — using the image of a pre-nuptial agreement "both for business people already in a marriage of financial sheets and those considering one."  Her interview with BMC Associates' Ed Kopf provides insight into the substance and logistics of developing a charter with BMC. In closing, Nycz-Conner points out that the importance of getting the partnership right is "especially true for family businesses, where the parties often can't economically afford to split up the company and, maybe even more importantly, have to be able to sit next to one another at Thanksgiving and pass, not throw, the mashed potatoes."

Partnership Perils: Planning to Prevent Them

The Practicing CPA

This article, published in the American Institute of Certified Public Accountants' online newsletter, discusses creating and maintaining productive relationships among partners. It is based on an interview with Dr. David Gage and examines the challenge many business owners face with ownership transitions. The writer advises, "To ensure the new group of partners can achieve [a successful transition], it is critical for the owners/partners who are transitioning out to see that the new group of partners negotiates a partnership charter that spells out in great detail how they will co-own the business and how they will work together."

Five Reasons Why You Still Need Scenario Planning
Harvard Management Update, June 2002

David Stauffer

In his lead article in this Harvard's Business School publication, David Stauffer gives five excellent reasons why scenario planning is more important than ever. He also provides examples of numerous companies that owe their survival to this specific planning activity. Paul Schoemaker, an expert in scenario planning from Wharton is quoted as saying, “Decision-makers who can expand their imaginations to see a wider range of possible futures will be much better positioned to take advantage of the unexpected opportunities that will inevitably come along.“ Arie P. deGenus, an originator of scenario planning who worked at Royal Dutch/Shell, is quoted in a 1997 speech. He explained, “We realized that the relevant question they can profitably address is not “What will happen?' It is 'What will we do if this happens?'“

A Family Charter to Keep the Family Business Running Smoothly
Bottom Line Business

David Gage

Bottom Line Business has been providing business owners with CliffNotes-like summaries of important topics for a quarter of a century. In this issue, Bottom Line Business asked David Gage to provide a quick synopsis of how the charter process can help partners to get clarity about issues such as money, power, fairness, percentage of ownership, expectations, and performance-issues that are often at the heart of serious problems among co-owners.

Ingredients for a Successful Partnership
Camping Magazine

Tony Stein and David Gage

Camps in the U.S. have a long and proud track record as closely held businesses. Tony Stein, a business consultant, tells a story about an ill-fated partnership between his father and a close friend of his father's. Tony Stein and David Gage wonder if Tony's father's partnership would have enjoyed success, despite their striking personality differences, if they had worked out all of the details of a Partnership Charter.

They write, “The experience of talking, exploring sensitive issues, negotiating openly and honestly, and creating a shared record of agreements helps to build a bond among the partners. It gives them greater confidence in their ability to handle situations side-by-side.“ With that accomplished, Morry and Ben just might have made it!

Partnership Charters: The Process for Achieving 'Interpersonal Equity' and Avoiding the Partnership Distress Syndrome
The Club Insider

Richard Yocum

BMC Associate Richard Yocum explains that the real purpose of partnership and buy/sell agreements is to protect partners from the disastrous consequences of any egregious acts committed by their partners and help them separate amicably. The purpose behind creating Partners' Charters, on the other hand, is to help partners operate more harmoniously and effectively, provide guidelines for making decisions together in trying times, come to agreements about how new partners will enter the ownership circle, and develop strategies to allow existing owners to exit in the best possible way.

Tools for Family Business Teams: Partnership Charters
Family Business Handbook: Building Strong Family Teams (Originally Published in Family Business Magazine as: “What Partners Leave Unsaid,“ September, 1999.)

David Gage, Dawn Martin and John Gromala

The editors of this handbook for family business owners call the Partners' Charter, “The tool most directly designed for co-leaders.“ The complete title of the handbook is “Building Strong Family Firms: The complete resource for creating and sustaining effective sibling, cousin, husband-wife, and executive and employee teams.“ This chapter by three BMC Associates includes a case study of a sibling team who recognized that they had money-related issues standing between them. The Partner Charter process helped them to see how important it is to deal with a number of related issues and not look at money in isolation from other work-related issues.

Having Partners: A Bad Idea?
IW Growing Companies

David Gage

Advisors and even business people themselves frequently assert that having partners is a bad idea. It's largely the fault of interpersonal conflict and unmet expectations. But David Gage claims that friction can be prevented or minimized if partners are willing to recognize and address the potential sources of discord. This Industry Week article includes a story of five very savvy business people in a start-up who got in trouble when they left a little ambiguity in their “deal“ with one another.

Business Mediation Helps A/E Firms Make Leadership Changes
Engineering Times (A publication of the National Society of Professional Engineers)

David Gage and John Gromala

Passing the Torch
IW Growing Companies

George Taninecz

Veteran business writer George Taninecz describes the ways that BMC Associates' Family Partner Charter can help family business owners buck the depressing statistics and keep the family business moving to the next generation. Sometimes “going back to square one“ is the most effective and fastest way to sort through complicated issues and put a business with multiple family members at the helm back on track.