It’s likely neither you nor your business partner foresaw the day when you’d need to call off your working relationship and go your separate ways.
You likely entered the relationship starry-eyed and optimistic. Much like a marriage, you probably put a lot of time into carefully defining the parameters of your partnership. Your partner believed in your idea, and you worked out the financing terms together.
However, somewhere along the way, your relationship soured. Maybe your 50-50 partnership turned out to be more like a 75-25 one. Or, more seriously, maybe your partner brought hidden debt into the relationship, and you found yourself scrambling to work around it. Perhaps you just don’t enjoy working with them anymore.
Don’t beat yourself up over a failed relationship. Various informal studies have found that anywhere between 50% and 70% of business partnerships ultimately fail. It would be more surprising if your business partnership worked out!
Business breakups are always easiest with an exit strategy in place before you run into turbulence. Before you discuss the breakup with your partner, you’ll need to decide whether you want to continue your involvement with your company or hand over control to your partner. For a clean break, many business consultants recommend setting a break-off deadline and sticking to it. (That way, your partner can’t talk you into continuing a flawed partnership.)
If you’re not staying with your company, you should disclose whom you’re working with next or what you’re planning on doing in the future to avoid future legal conflicts of interest.
Check out our infographic for a closer look into the sometimes-messy world of business partner divorces.
Sources: Houston Chronicle | LinkedIn | BFV Law | Business Collective | UpCounsel | Grocery Dive