Tag Archives: prospective partners

You have no friends in business

29 Aug

If you decide to start a business with a partner, then here are a few caveats.
1. Get a contract signed between you and your partner. Do NOT use a copperplate from the internet, get a lawyer to produce the contract!
2. When you open a company bank account, make sure that you are both aware of how the account will be managed. Do not allow either partner to have access to the account without the consent of the other. Banks nowadays have systems where no transactions can be made without the consent of both partners.
3. Don’t think that because your partner is a “nice person” that you can necessarily trust him/her. Even if the partner is family or an old school friend, put proper management into place to control how the business is run.

I made the classic mistake of trusting my partner, thinking that he was an honourable man. We took a bank loan of R200000, which was removed from the bank, into his own personal account within minutes of the bank depositing the money. He then paid the money to a third party the same day. When I contacted him about this, he lost his temper and said that the money was his.
He than had the audacity of blaming me for “misusing” R40000 and had his lawyer send me a letter to express his anger.
(My partner is, sadly, not the sharpest knife in the drawer and is completely under the control of his wife, who also works for the bank where our company account is kept – I didn’t stand a chance.)
Obviously, I now have to resort to legal action to get everything sorted out.

If possible, start the business on your own. Prospective partners will try to persuade you with all sorts of promises and altruisms.