When it comes to doing business with friends, people become extremely skeptical and quote the famous rule “never do business with friends and family”. But why exactly? Other than a bunch of statistics—which aren’t really credible—they don’t really give good reasons why it’s not recommended to work with friends.
The premise of their argument is based on the fact that friends can cheat, slack, and lose their money. This assumption is flawed in so many ways; this risk is also present in working with a business partner who isn’t a friend. Some argue that it can result in unrepairable damage and tarnish the friendship, but so can any personal life event. So, what’s the point?
While it’s true that not all friendships can evolve into business partnerships, it’s time that people stop being afraid to do business with friends. Whether you want to do business with friends should be your personal choice and depend on your specific circumstances rather than norms and society.
In this blog, we will demonstrate why doing business with friends can actually be a great decision. A business partnership shares similar characteristics of a marriage. It requires trust, communication, and respect. These are the three pillars that keep the arrangement intact and help cultivating long-term personal and business relationships
Let’s learn how doing business with friends can help fulfilling each of these criteria:
Increased level of trust
The beginning phase of a new business can be very challenging and overwhelming. Having the right partner on your side whom you can trust can make it easier for you to start off your journey with confidence and self-assurance. A trusted friend can be your best bet as you can put your faith in them.
They don’t have any secret agendas. You know them long enough to know that they have your best interests in their minds. You can trust them to remain faithful. The high level of trust will allow you to openly share knowledge, which will help to achieve a synergy that will benefit your business.
Moreover, when your business partner is taking meetings with other CEOs, you wouldn’t be worried that they’re trying to replace you or have any hidden plans, which is fairly common in the corporate world. It will allow you to maintain a successful partnership with your business partner and result in unsuccessful business outcomes.
Improved levels of communication
The importance of maintaining effective communication channels with your business partners cannot be overemphasized. Open communication reduces the chances of misunderstandings among partners and maximizes the likelihood of success. It helps in cultivating long-term relationships among business partners.
While interpersonal skills also play a big role in ensuring open communication, talking to a friend is usually more convenient for many entrepreneurs. The main reason is that friends develop a trusting relationship and aren’t afraid to call out each other on their mistakes, which is important when running a business together.
Moreover, it’s very common to argue with your friends so if there’s a disagreement among you and your friend about business decision, you can sort it out in a more effective manner, which might not be the case if you’re having an argument with a business partner who is just your business partner—and not your friend.
Respect is an indispensable ingredient to a successful business partnership. If you don’t respect your partner and their feeling is mutual, it’s virtually impossible to build a workable partnership. While you may also respect a business partner who isn’t your friend, it’s not quite the same.
In many cases, running a business can make it difficult to balance your personal and professional life. While business partners only value and respect each other’s business interests, friends also respect each other’s personal interests. They are willing to put their friend’s interests above their own and understand the situation better.
A great example of mutual trust among partners in the business partnership between Bill Gates and Steve Ballmer. Gates was a genius at software development and Palmer excelled in driving ideas from inception to implementation. The successful duo shared a great friendship; they appreciated each other’s strengths and had massive respect for each other.
It makes perfect sense!
Starting a business with your best friend makes sense! It ticks all the boxes of a perfect relationship—trust, communication, and respect! What’s better than working alongside with your friends? The work will seem more enjoyable; you can talk about sports, TV, or literally, anything like you do with your friends.
Moreover, history tells us that working with your friends can take you places. Warren Buffett and Charlie Munger. Bill Gates and Steve Ballmer. Bill Hewlett and Dave Packard. There are several examples of people creating a fortune for themselves while doing business with friends.
Working with friends increases your chances of success. Peter Thiel, the co-founder and former CEO of PayPal, who has a net worth of $2.5 billion (as of this writing) believes that founders must know each other before they start a company as to how well they know each other and work together can influence the final outcome of the arrangement.
We hope that you feel more comfortable working with your friends now. If you are looking to start a new venture, you can immensely benefit from contract staffing. It allows hiring skillful workers on temporary basis without any strings attached that allows you to keep your startup costs to a minimum
it’s critical that you find a trustworthy contract staffing agency that offers quality resources to set your business off to a great start. With a friend who’s got your back as your business partner and a team of skilled employees, not much can go wrong. And even if it does, you will have a friend and a team of professionals to watch your back.
If you’re searching for contract IT staffing and professional services, IT Avalon should be your ultimate choice. Based in California, we’re an award-winning contract staffing and recruitment company that offer qualified and highly skillful candidates to set your business off to a great start. To learn more about our services, or see a list of available contractors, click here.