Business partnerships require more than just trust to be successful. My very first business venture was a coffee shop. This was back in the early ’90s when coffee shops were new and edgy. I’m not sure why they were considered edgy—maybe because we were asking you to pay a full $1 for a cup of freshly roasted drip coffee. That was ridiculous, and the old folks told us that all the time. Little did anyone know how much more ridiculous it was going to get.

The coffee shop wasn’t my idea, but I was invited into the venture with two friends. We knew, liked, and trusted each other. But not for long.

Early on, before things got weird, a mentor of ours stopped by the shop as we were still setting it up. She seemed serious and advised us to pay close attention to our communication and relationships. We heard her out but didn’t listen. We weren’t having any problems, so what did she know?

Long story short: within a year, two of us were barely talking to each other, and one had left the venture altogether. It was incredibly painful and difficult. Why? Because we did what most partners do: we jumped into an idea we were excited about—without clarifying any of the important aspects of our relationship. Mostly because we had no idea what those were.

But even if we did, I don’t know if we would have. We were young, dumb, and our enthusiasm made us feel invincible. Plus, hammering through details like putting things in writing… none of that is fun. It all feels corporate or lawyerly or like we might not trust each other. But trust is easily lost, and once lost, it is very difficult to regain.

Key Steps for Building Strong Business Partnerships

It’s 30 years later. Fortunately, I’ve learned a few things. My relationships with both friends were eventually healed—though it took years in both cases. I’m not sure if they’ve reconciled with each other.

Here’s what I wish I had known: We should have taken the time to clarify where we were going, how we would make decisions together, what we expected from each other, and—last—what to do if any of the understandings above changed.

Where are we going? Imagine a family trip where we say, “We’re going to Hawaii!” It’s easy to assume we all share a similar vision of what that trip will be like. But if one person is expecting to stay at an all-inclusive resort, another is hoping for a VRBO off the beaten path, and the third is planning to stay at a hotel near a conference center he will attend during the entire trip, all of a sudden, “Hawaii” isn’t a very specific description of where we are going.

Many business partnerships make the same mistake. “Let’s start a technology business!” or “We should open this together!” More definition is needed.

These questions help:

• What do we hope the business will look and feel like when we are successful?
• How large do we want it to be? How many employees or locations?
• What kinds of customers will we have? What do we want to be known for?
• What are our long-term goals for this business?
• How long would we like to stay involved? How involved do we want to be?
• What might an ideal exit look like?

How do we make decisions together? Answering the questions above helps make decision-making easier. You can take another major step forward by defining your shared values—the principles that each of you considers important when making decisions.

Many people think this is obvious until they discover that one person is very motivated to save as much money as possible while someone else is motivated to produce the highest quality product. The values of thriftiness and quality aren’t automatically opposed to each other—but they often conflict as well.

These questions help:

• Can you describe a personal or professional experience where you felt your values were deeply challenged? What were those values? How were they challenged?
• What do you believe are the top 3 qualities in a business partner or colleague? What makes those important to you?
• In 3-5 words, what do you want your business to be best known for in your community?

What do we expect from each other? Partners always carry and develop expectations for each other—but these are often uncommunicated. Also, most partners haven’t articulated their own expectations for themselves that well. This leads to much of the frustration that partners experience.

Here are questions that help:

• What are your expectations for our communication and decision-making processes?
• What are your financial expectations regarding investment, compensation, and profit-sharing?
• How do you envision our day-to-day roles and responsibilities?
• What level of time commitment do you expect each of us to dedicate to the business?
• How do you expect us to handle growth, scaling, or changes in the business direction?

What do we do if something substantively changes our understanding of the above—or if we have a conflict we can’t resolve? Both change and conflict are certainties. No one can imagine the future perfectly. Every close relationship should expect to have conflict at some point.

These questions help:

• What is our plan for handling significant changes in business direction or strategy, and how will we make those decisions together?
• How will we address situations where one partner feels that the agreed-upon processes or decisions are not being followed?
• How will we approach conflicts or disagreements when they arise, and what steps will we take to resolve them?
• What methods or tools will we use to ensure open and constructive communication during conflicts?
• How do we decide if or when to bring in a third-party mediator or advisor to help resolve disputes?

Trust Alone Isn’t Enough

Trust is important in business partnerships. It’s impossible to work together well without it. But trust must be maintained and supported. Taking the time to think through answers to the questions above will ensure that you and your partners can focus on working with each other rather than being at odds.