Once establishing itself the management team, have to be prepared to accept changes in economics and be prepared to react accordingly. Each partner’s perception of the direction the business should go changes as well. A hand’s on management approach is required to deal with the many day-to-day decisions. Should you be switching suppliers, increasing your marketing all decisions that require solutions?
In the event of a successful launch be wary of unscrupulous investors looking to buy into a good thing when all the hard work has been done - there is no such thing as an ‘Angel’ investor. It is imperative that both partners are if full agreement on any investor decision. What if one of the partners acquires an asset for the business whether it’s land, a building, a small data center, a thousand servers, or to complicate things further contributes an intellectual asset of some sort.
When the company is going to be sold, what is the value of the partner’s contributed asset? This can often become a real obstacle. Most buyers know not to value any one piece near what it’s worth by itself. When it’s time to sell the company, the financial situation of each partner has no doubt changed since the company was founded.
There are many permutations on structuring a buy out or buy in. And one should always consult their own professional for their input prior to making any decision. Most deals fail due to internal disputes and disagreement between the partners of the company. I have seen many long term friendships end in such disputes over differing values of a company. Any company is only as good as its talent at the helm. My suggestion is one ship, one captain.
