Tag: business partnershipSubscribe 2 Posts
Do you really want your business partner's spouse as your next business partner? Here is the problem: You have built up a business with a partner and worked well together successfully. However, you know that if your partner died, you would really not want to be running the business with their spouse. Most likely your business partner’s interest in the business is left to their beneficiaries who don’t have the skills, experience or expertise to contribute and/or may just not be compatible with your personality. You may wish to purchase the outgoing partner’s shares in the business but don’t have either the funds or anything in writing giving you the right to purchase at an agreed price. Sit with your partners and adviser, and ask some simple questions: If one of the business partners died or became totally disabled, would you want to buy their share of the business? Can you agree on a way of valuing the business? Should you have a business succession plan that gives each partner rights to buy the other’s shares in the event of them leaving, dying or being disabled? How would you fund this type of arrangement, and should you have a facility or strategy arranged to fund it?
What business lessons could we learn from the demise of TomKat – aka Hollywood couple Tom Cruise and Katie Holmes? What happens to a business when a family relationship sours? A couple breaks up? Friends fall out? Each of these scenarios could leave you in a potentially similar situation to what the world press is predicting for the former power couple – possibly surprised, upset and in a fight over assets. If you own a business with anybody else, have you got adequate protection if something goes wrong?