Podcast #4: Does your business partner share your values?

Tanya: There are 12 different driving forces and we like to look at the top 4 for each person. And it’s kind of where you start to see whether someone values doing a lot of research versus making their decisions based on intuition, or whether they value collaborating, or whether they value doing things the way they’ve always done versus thinking outside the box. It’s kind of just these different trade-offs of what values people bring in. So we kind of like to see how they line up.

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TAGS: Partnerships, Facilitation, Merging, values, compatibility, problems

Partnership Equity Splits and “Fairness”

“Measure what is measurable and make measurable what is not so.” – Galileo

For new partners, either starting a new venture or merging their businesses, few conversations are as difficult as discussing what the equity split will be. So, like any potentially messy conversation, it is often avoided. The default is to go with an even split or a split that ensures control to a specific founder.

When we see partners in serious trouble, with businesses that are in jeopardy because they can no longer work together, it is often because there is a sense of unfairness about contribution, compensation or control. Often this can be traced to

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TAGS: Facilitation, Merging, Co-founders

What You Need to Know About Your Co-Founder

“All happy families are alike; each unhappy family is unhappy in its own way.” - Leo Tolstoy, Anna Karenina

Whether or not he was correct about families, Tolstoy’s philosophy does not seem to hold true for business startups. In fact, the opposite is true: startups can succeed for a variety of reasons, but most fail for the same reason: poor relationships among co-founders. Studies suggest that the majority (62%) of failure in start-ups is attributable to irresolvable conflict among co-founders. This is unfortunate not only because some great business ideas never come to fruition, but also because it is preventable.

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TAGS: Facilitation, Coaching, Merging, Co-founders

Thinking Like A Business Partner

“If two men agree on everything one of them is unnecessary.” - Henry Ford

 Advice about finding the right business partner almost always includes looking for someone with complementary skills. Especially in a start-up poised to grow rapidly, it seems smart to get partners with clearly distinct skills. But the truth is that a partnership can perform very well even when the partners do not have clearly defined complementary skills. In most cases a leader can hire someone with the skills they need. What partnerships have trouble surviving is a lack of complementary thinking styles.

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TAGS: Coaching, Merging

Assessing Your Partnership Fit

If you are considering a merger or acquisition, or hiring with an eye toward an internal succession plan, your fit as partners will matter more than any other factor when it comes to the success of your practice.  In fact, San-Francisco-based Funders and Founders estimates that 62% of merger failure is due to partnership conflict. 

“Fit” can take into account lots of elements of compatibility; we’ll use it here to mean skills, behaviors and motivations.  Most are looking for someone with complementary skills; someone with strengths in areas where they feel less capable.  Ideally,

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TAGS: Merging, Co-founders


"If you always do what you’ve always done, you’ll always get what you’ve always got." - Henry Ford

The recently released Aite/NFP white Paper “Alpha Acquisitions: Maximizing the Return on your Practice Investment” analyzes post-acquisition success among 100 financial advisor transactions. The paper introduces the term “alpha acquisitions” to describe transactions resulting in “highly-satisfied” principals who say they would do their transaction again. The study also identified a middle tier (45%) of “near-alpha’ principals who were “satisfied” and would “probably” do the deal again, the remaining 30% or “non-alpha” were not satisfied and would not do the deal again.

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TAGS: Partnerships, Facilitation, Merging, Succession

Are You Facing A Founder's Dilemma?

In his landmark 2008 Harvard Business Review article, and subsequent book, “The Founder’s Dilemmas,” Noam Wasserman posed a thought-provoking question for business founders: Do you want to be rich or do you want to be king?”

Wasserman was mostly addressing startup CEOs about the tradeoffs inherent in taking outside money, or trading equity for needed skills.  But it is a question that can be posed to founders of professional practices who are faced with challenges in reaching the next phase for their firm. The need to stay competitive, or just to reach their full vision, often means bringing in others with needed skills or merging to gain economies of scale. Getting this talent or scale often comes at the cost of giving up sole control.

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TAGS: Merging, Co-founders

Have You Done Your Cultural Due Diligence?

You would not think of tying your professional and financial life to others through a merger or a partnership without careful due diligence. Due diligence involves doing a premerger analysis to uncover risks and avoid unpleasant surprises. This can require hiring attorneys to pore over existing contracts and legal arrangements, while having an expert go over the financials.

A statistic we often quote because it is so compelling is that, even with this pre-work, 70% of mergers fail, and of those that fail 62% do so because of partnership conflict. Since conflict can be so destructive and expensive, investing time and resources in cultural due diligence is very worthwhile. Cultural due diligence is making sure that you will be able to work together productively because, as an organization, you are aligned in values, mores, and standards.

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TAGS: Merging

Merger Therapy: What You Need to Know About Your New Partners Before You take the Plunge

Our latest research “Best Practices in Investment Advisory Partnerships” (download here) was profiled in the June 2014 edition of Inside Information, a subscriber-only publication read by investment industry leaders. We appreciate the author, Bob Veres’, take on our research. He has been a thought-leader in the field for decades. As he points out we did put a lot of thought into, “asking all the right questions. What makes successful partners stay together? What builds the commitment and resilience in a partnership? What can people do to feed that and make it grow?” Some of his comments, and even the title of the profile “Merger Therapy”, gave us a different perspective on how others might see the value in our work.

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TAGS: Facilitation, Mediation, Merging

Solo Practitioners, What Are You Afraid Of?

If you are currently a successful solo practitioner, you may still think from time to time of the benefits of having business partners.

Business partners give you a built-in continuity plan that is so important to clients and regulators. It would be advantageous to spread the expenses of items such as rent, software, and legal fees over more professionals. There is a chance to gain better profitability through increased scale. You have the chance to complement your style with someone else at your level: if you like to think big picture, a partner who is good at details or implementation may add to your success. And, of course, you’ll gain the chance to take a real vacation.

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TAGS: Merging, Co-founders


  • Form strong partnerships
  • Resolve partnership conflict
  • Reinforce your partnership dynamics

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