This is the first in a two-part series on whether or not people are ready for partnership. This will focus, first, on whether you, as the principal, are ready for this. The second will focus on whether the candidate is ready for it, and that can be found here.
As background, I’d be very cautious about adding a partner in the first place. I’ve seen wonderful partnerships and disastrous ones. They really can be wonderful, but they can also drive you to an early grave. The 2Bobs episode on Jan 31, 2024, talks about the financially inevitable penalty that comes with multiple partners, so there’s that, too. But in spite of all the bad news, having the right partner can be an amazing experience. This article is meant to help you know if both parties are ready for it.
Are You Ready?
We put a lot of partnerships together (and pull some of them apart), but here are a few things we’ll ask a principal to see if they are ready:
- Are you ready to make it public? There are no healthy partnerships that are also secret, but sometimes a principal wants to make someone a partner—to keep them at bay or whatever—but they don’t want others to know about it quite yet. The typical reason is because it will signal that someone else has been excluded. See the next point.
- If this is part of a succession play (in other words, you’re leaving the firm soon), are you willing to designate one person as the primary lead partner? This, too, often comes from the same pressure: “there are three people who want to be minority partners, and none of them has enough money on their own, so I’ll just arrange a marriage and increase the chances of this working if they can do it together.” Wrong. Pick a lead partner, and let that person assemble their own team.
- Are you willing to be transparent about everything, including your own pay? There should be no secrets. Eventually a principal will share financials, but often they’ll want to limit disclosure of how much they make, personally, which is silly. A junior partner will expect you to make more, and the more you make, the more alluring partnership is. You just have to get over it.
- When you do announce this new partner, will most of the adults in the room shake their heads, agree that it’s a good idea, and wonder why it didn’t happen earlier? Moving someone to partner status should just confirm what’s kind of already true. The team should accept it…and even welcome it as an excellent idea. This person that you are making a partner will have already paved their own way by impressing most of the right people.
- Is there enough upside in this action that you are willing to accept the downside if it doesn’t work out? Here I’m talking more about the initial discussions, when you broach partnership, but haven’t concluded it yet. When you ask someone to marry you, there’s going to be a yes or a no—the status quo is no more. So don’t initiate this beautiful process unless you’re willing to let that person walk if it doesn’t work out.
- Are you willing to make decisions collaboratively? These decisions will be a tad slower, a tad safer, and a bit less remarkable, but the process will not be the same. You won’t have a boss, per se, but you’ll have less freedom to move forward. That isn’t all bad, but it’s different.
- Do you have disparate roles? Your two different roles shouldn’t look like a stack of plates where comparison and overlap are inevitable, but rather intersecting rings where you lead a distinct area, trusting the other partner to do the same in a different area of strength. Have you worked all that out?
There you have it. The early ones to test yourself on are nos. 1 and 3, and then the rest will fall in place if it’s a good idea.
Oh, and don’t forget to keep the partnership discussion going, too, once you’ve initiated the idea. Dragging it out sends the wrong signal. If we can help you with this, just hit reply.
In the next article we’ll talk about whether the other person is ready for partnership.