*Note: This was written by a Yahoo! contributor. Do you have a small business story that you'd like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.
COMMENTARY | I live and breathe my business every minute of every day. I don't lack motivation. But recently, I came to realize I lacked insight. I learned from a complete stranger the power of objective advice.
With our current economic state, its been a tough few years. I recently spent a few days alone to just think about my business and where I wanted it to go. I spent days just walking around thinking, hoping for a sign to tell me how the future may unfold. While none came, I came to realize two very simple things. The business needs capital and I needed partners to help me grow the business.
The marketing consulting industry is saturated with small and boutique consultancies. I am one of them. After losing my largest client last year, the business has struggled to say the least. I hoped that partners could infuse the business with much needed capital as well as expertise.
After a few months, I decided to go with a few business acquaintances that I had worked with in the past. They had capital. They also brought a network of resources and expertise from another industry that complimented our capabilities.
I met with our potential partners for dinner and drinks over the next few months. Eventually we came to an agreement in principle. On the morning I prepared to sign the operating agreement, I read it over one more time. My gut told me that it was a good deal. But I had one nagging issue. They had asked for 5% more equity than I had initially offered, without providing more capital. Between the dinners and cocktails, I somehow agreed to this.
Instead of signing the operating agreement, I went for a walk in our local park. I sat for a long time on a bench and watched some Canadian geese walk back and forth. Minutes turned into an hour then an older woman came and sat next to me. She opened her book and said hello. After a few seconds, I realized I did not respond. I quickly apologized.
We talked for a few minutes. She was a retired school teacher in a nearby elementary school. I told her about my business then went into how I had a big decision to make about taking on partners. I explained the type of small business I operated and why I was looking to expand. She clearly noticed the tension in my face.
Moments later she explained how she knew very little about business but that her husband, now deceased, told her to follow a very simple rule in life. "Invest your time with those you trust and everything will be okay."
I'll never forget her words. As badly as I wanted to go through with the partnership deal, I went home and ripped up the operating agreement. I called it off for one simple reason. No amount of money can buy trust. It had to be earned.
There are no comments yet