Family & Friends Going Into Business
Top tips from Ison Harrison’s Commercial Team
- Talk about it: cover as many concerns as possible, making a list of types of contingencies that may occur. What if someone has to stay home with a child? Talk about who is going to do what in the case of emergencies or disputes.
- Decide who owns what: you may want to split ownership 50/50- but there may be valid reasons for not doing this. For instance, if one person is going to work full time and the other part-time, a different ownership can reflect this.
- Determine your business form: learn how different types of business organisations can suit your circumstances. Partnerships, LLP, or Limited Company? Learn which model works best for you.
- Get your legal documents in order: It is vital that the owners of the business have appropriate contracts documenting issues such as ownership in the business and exiting the business. Create written agreements detailing roles in the business.
- Get outside advisors involved: having professional legal and financial advisors who aren’t family or friends can diffuse tensions that may arise