7 Keys to Healthy Co-founder PartnershipsThese concepts are relevant for entrepreneurs who want to strengthen their collaboration.
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The saying goes something like this -- co-leadership is no leadership. I don't buy it.
Since 2007, David Scherer and I have been co-CEOs of Origin Investments, a Chicago-based real estate investment firm with nearly $500 million in assets under management. And we were friends before that. I'm pretty sure that's another rule we ignored.
So how has our partnership survived? David's helped me come up with seven reasons our relationship has not only endured but flourished. More appreciably, these concepts are relevant for other entrepreneurs who want or need to strengthen or sustain their collaboration.
1. Make equally shared financial contributions.
If one partner invests in a deal and the other doesn't, and it goes south, the partners are not in the same situation. To keep our business interests aligned, we assume equal financial risk. We put an equal amount of money into every acquisition and the company.
2. Shoulder equal workloads.
Equal contributions must extend to time spent on the job. Having one guy working part-time and the other working 80 hours a week will only lead to bitterness and resentment. I've witnessed different work ethics tear partnerships apart. Plus, it's impossible to be equally respected as leaders if you don't both lead by example and hard work.
Related:Everything You Need to Know About Business Partnerships
3. Have shared transparency and alignment values.
Partners must be transparent. Keeping secrets from each other, whether personal or professional, will destroy a partnership. And we extend the same standard to our business by investing substantially alongside our investors. So if one of us thinks funding 2 percent of a deal is substantial, we have different values. To date, we've invested or committed $42 million to the firm's real estate deals.
4. Respect defined roles and responsibilities.
While we jointly decide whether to purchase an office or apartment building, we're careful not to step on each other's turf. "We don't manage each other's people," my partner Dave says. "Otherwise, it's not only a stress on the partnership, it's a stress on a team. Each partner has to respect the other's role and not second-guess his decisions." Leading our teams is an individual responsibility we do not violate.
5. Actively work together.
Though we split responsibilities and run different areas of the business, we do overlap on critical decisions such as investments and direction. This creates a parallel management model that helps us know and respect each other's judgment and skills.
Related:What to Consider Before Teaming Up With a Partner
6. Agree on vision and responsibilities.
Some partners don't agree on vision, or even understand what their vision is and where they want to take the company long-term. If I say "I really want to invest heavily in digital to target investors," and if my partner Dave says "I want to hire an investment bank to work with pensions and endowments," that is an unshared vision. We should be able to speak as one on the firm's investment focus, business plan and discipline.
7. Foster communication and don't keep score.
Partners must develop ways of speaking with each other that won't build resentment. We don't always get along, but we have found ways to talk about things and move past them. Dave says "resentment is not like wine. It doesn't get better with age." We don't let conflicts fester, and we communicate as much as possible face-to-face and via phone. Also, we each reserve time to communicate and treat those meetings as if we were meeting with a client.
Related:13 Tips to Create the Perfect Partnership
We each arrive on time and are prepared. Right now, our partnership is approaching its 10th anniversary, and there has never been a time when we've had a stalemate. I like being able to knock ideas off a partner. It keeps me accountable. But best of all, I like the freedom to focus on my own projects and passions -- and know that my partner and I have each other's best interests, and those of our company, in mind.
