Partners

[Shaun @ Tru6]

Any entrepreneurs here sign on an active partner while their company was still growing? How did you find one? How did you map out an equity stake in the company? Role and responsibility considerations? Everything.

Little Traveler is still very small...I'm looking forward to the day when I can get a paycheck. And the impending recession means sales are only "good" in 08, though the fall line is looking amazing and we'll start selling in February...will be a a great real time barometer on public opinion about the economy.

My current partner has been awesome, but she was just promoted to VP level at State Street Bank and will have little time for LT. I've developed 3 completely new design styles that will play well in the big markets (young contemporary---fashion-forward young women), one concept to patent, the book concept leading into animation and brand development and so on.

A lot of great opportunities, but not enough time even if I boxed the E and put it in storage and never posted on OT again. And not enough $ until a business plan is written and shopped.

Having a partner on board would be a huge help.

Anyone have experience in this situation?

[stomachmonkey]

Yeah, can go easy or messy. Depends on the individual you are considering. If messy usually will not get better with time.

Once booted a guy from partner consideration because he did not bring a notebook to the first meeting. Sounds insignificant but 1st impressions and all.....

[legion]

Who do you trust?

[Shaun @ Tru6]

Scott, still need to call you, sorry, just been all over the place. let me know a good time for you.

yes, I've read a lot of stories. and I'm a very difficult person to partner with.

Chris, excellent question. I'm very trusting and it almost always gets me in trouble.

[Halm]

There is not enough storage space on the PP server to properly discuss this topic. So to get it into as few words as possible, THIS IS THE SINGLE MOST IMPORTANT DECISION YOU WILL MAKE. You can never do enough due diligence so don’t stop until you can’t think of anyone else to call. Then try again.

This was advice given to me by a very successful entrepreneur that I had the pleasure of working for. I treated it too casually and when I brought in partners to a solid startup, within 6 months it was doomed with no way out.

If you would like to talk, feel free to PM me.

[lendaddy]

If it is at all possible to not have a partner that is a much better way to go. Just curious and maybe it's none of my business, but what do you do for income? How do you pull this off?

[Shaun @ Tru6]

Very good advice Hal, PM'd you.

Joel, no worries. I haven't had a paycheck in over 3.5 years now. Let's see, I've:
Used to have savings, now have debt
Used to have 3 911s, now have 1
Used to have a collection of great, some rare, Porsche parts, now have basically none
Used to have a nice practical car, now have a true piece of junk 4Runner
Used to have a beautiful apartment, now I don't. Some people have a home office, I have an office home.
I live very very very frugally.

On how I keep Little Traveler going...I'm good at managing cash flow. I've convinced our suppliers to get paid on delivery or even Net 30, and we've done fairly well. Was almost profitable in 07, our first year.

in fact if I had been able to start Little Traveler fresh from my last career without the death of G9Girl sucking nearly every $ and a good deal of energy out of me, we'd be busting at the seams with actual vs. potential growth.


and yes, if there's any way to not have a partner, that's the way to go.

[berettafan]

In a perfect world:

-find folks for whom the $$'s you need are peanuts.
-from this list eliminate the folks that insist on participating in the bsns.
-from this list elimiate folks who want double digit returns immediately.

Consider an LLC arrangement where losses are allocated to the non-mgt members/investors as an incentive.

In an imperfect world:

-Get and review financial statements from the people you are considering. do NOT take their word on things like net worth, liquidity, etc. Possibly have a CPA review their info. There are crooks out there who will be happy to dump your bsns in the toilet if they can pull $10k out of it for themselves.

-Shoot for a partner you think is a better person than you. bring yourself up, not down.

[911Rob]

Shaun,
You write like a true entrepeneur....... ha, ha. A little hard to follow.

One of my first BIG businesses was a three way partnership.
One partner jumped ship when there was no profit sharing after the first year.
I was so focused on buying out the other partner that I spent 3 to 4 years working for beans.
Bought them out.......... for what, I don't know?
Yippy, I got to make ALL the decisions; so what? It was a stupid mistake on my part.

I was taught: Partnerships are Dangerous Ships.

Today, I have several partnerships.
It's much like being married, in fact the best partnerships are exactly like being married.
One guy calls me his "man wife"; not funny, but almost true.

In a marriage two halves make a whole.
Look for a partner that has skills or traights that you don't have.
Many skills and functions involved in having a good partnership, but honesty and integrity are the rule, with no exceptions.

You sound like a creative, energetic, idea type guy.
Look for a managerial, organized, geeky type of partner.
Probably be a good combination for a winning team.

As far as making excuses for no profits. STOP!
There are no excuses for no profits. Period.

Good Luck good buddy!

[TheMentat]

Originally Posted by 911Rob

Shaun,

Look for a partner that has skills or traights that you don't have.


Good Luck good buddy!

like spelling skills?

[Sapporo Guy]

Partners .... that is really tough. I've always thought that a partner should be somebody who you are not. One person is the front end and the other the back end (no puns intended) So, one is great with sales and people the other being great at running the show from a no lime-light position.

Being friends is more difficult because business is business and if the business is running bad your friendship will go bad too. I have a silent partner and he is somebody I would consider if I were to die would be the person to raise my child for me. But even then we have our quarrels.

My business is small and profits are small too but still the fundamentals are the same.

What are you selling? Clothes? google turned up a page that has a crest of arms but no real site.

Just out of the blue it sounds like you need a sales person or more likely a sales plan rather than a partner. But then again I don't know you nor what you have done so far, so what am talking about.

Could you fill us in on your operations? I'm sure we could be more helpful if we knew more about the back end and what your product is.

OK, back after going through the thread a bit more -- G9Girl ... clothes.

This is really a guess work post but I'm going to assume that it's clothes and accessories like bags so ... I'm going to throw the idea of not running a shop / store front but rather focus on finding locations to carry your product. I have several friends in town who started out little and have slowly grown bigger by buying / contracting out with out of country suppliers and then moving those products in the Japanese market at other retail locations.

IF I can be of any help let me know. I can contact a few people here in town who I trust (they have different amounts of working capital ... )

The more I think of it ... the market timing might be good for Japan since parents are spending more on their children than themselves.

Anyway, if I can be of help, let me know!

[KaptKaos]

If you have been at this for 3 years, and have no profits, then something is wrong.

Very very little is how little? Gross sales, # employees, etc...?

Specifically, why do you want to bring in a partner?

We have a saying at my company: "Profits fix everything."

[MT930]

Some very good advise given here. Make sure you know the difference between and investor and a partner. Giving up control in a business you have started could lead to trouble. Don't do it with friends, the odds are good things will not work out. I formed a partnership with a guy 7 years ago business first. He is many things I am not. He has become one of the very best friends I have ever had. He brings many experiences that I have not had. It's a balance that works. Make sure you have similar finance practices and goals. Choose wisely as said earlier in the thread it is one of the more important decisions you will ever make.

[Hugh R]

A partner that needs someone to grow is one thing, a partner that needs someone to survive is something very different. No advise on the partner thing, other than to say make sure they have as much to lose as you do, if not more, otherwise they're an investor.

[DARISC]

Take no prisoners.
Take no partners.

[Shaun @ Tru6]

lots of great advice here, thank you.

The Net-Net is I won't be bringing on a partner.

Rob, you are dead on. I would love an organized, bean-counter type as a partner. Certainly someone to hire when I can. Good advice on profits. I could write a book on the emotional rollercoaster you go through coming out of a 6-figure career, losing it all in a failure, then clawing back with slow and steady success. It's sometimes too easy to make excuses.

Sapporo, I'm glad we are already doing a lot of things you suggest! Little Traveler is a manufacturer of boy's clothing (12M to size 12) sold to better boutiques in the U.S. and this Russian department store placed a healthy order for this Spring. http://www.nvozrast.ru/index.php?section=9 We may be in Mitsukoshi in the Fall, they have shown good interest in us in the past.

The website is just a splash screen for now, that will change in February-March when a fellow Pelican Kroggers in Sweden creates a nice site for us.

Operations: Myself and two-three other Pelicans (deanp, targa florio, gostraight) create fall and spring collections which are then sampled in India. We have showrooms (sales reps) in NY, LA, New England and Toronto. We'd like to get sales representation in Europe as well as the Southern U.S. After orders are placed, everything is made in India, shipped to us and we fulfill orders.

We produce several kinds of t-shirts (I've just created a whole new style not seen in the market), polos, poplin button downs, jeans, cords, twill pants, cargos, linen, vintage leather motorcycle racing jackets (distressed Italian lambskin), etc.

Here is our spring 08 linesheet:
http://www.littletravelerusa.com/LTSpring08.pdf

Fall 07: http://www.littletravelerusa.com/Little_Traveler_Fall07.pdf

I'll be posting some of the Fall 08 designs this weekend. And one of the lines has a Japan motif. I'll let you know when I post them.

I appreciate your offer of help! Let me know if you'd like to see a sample package. I can put one together for you and we can go from there.

Wayne, your input is very much appreciated, thank you. I'll look into this kind of person. If I were in NYC, I think they'd be easy to find. Wonder about Boston.

KaptKaos: late 2006 - 2007 was Little Traveler's first year of operations which rose like a phoenix from the death of my previous venture, G9Girl. In one year we went from 0 to 114 stores carrying our clothing.

I need a partner to help develop opportunities more than anything else.

MT930: If and when I bring anyone on board, I need someone who is grounded, conservative, a real bean-counter. I have more ideas than time and money typically and need someone to offer focus, reign me in at times, make me prove a case for going forward with a new product, etc.

Good advice Hugh. I tend to put too much of myself into a venture, so it's always difficult to find someone who is as committed (pun intended).

David, so I should let those prisoners go?

Thanks again everyone, your good thoughts and support are really appreciated!

BTW, good news is out of nowhere my book author showed up. I worked with a technical writer/consultant while at Network World magazine back in 04 and he pinged me on Tuesday via LinkedIn. We talked for a bit about old times and caught up and while this guy writes about enterprise level networking solutions, I asked him if he knew of anyone who could write children's books. He was very interested, we discussed the project and he brainstormed with his 5-year-old daughter and came back to me today with some great stuff. And a friend of ours, an art director, was recently laid off, so it could be a good thing. Serendipity!

[DARISC]

[QUOTE=Shaun 84 Targa;3696607]David, so I should let those prisoners go?/QUOTE]

You took prisoners?
Oh my, NO!
Ship them to
Guantanamo!

[LeeH]

My partnership worked out great. My biggest competitor approached me with the idea that there was a potential synergy in putting our companies together. It made sense. We competed on a few products, but he carried some products I didn't and I had efficiencies with some products that he carried but didn't sell well. When I look back, it's pretty frightening how little thought went into the whole thing.

We did some analysis and came to the conclusion that the companies were worth roughly the same amount. So, we threw it all in a pot and stirred and everything came out great.

My partner was way better at sales and I was way better at running the business. We had a few issues here and there, but overall the value of our business increased significantly after the merger and life got a lot easier sharing the burden.

[Sapporo Guy]

Mitsukoshi is great to get into, however, I hate to say this but here in town that department store is more into cosmetics/older ladies apparel.

Have you gotten into any magazines?
Do you have a lineup for girls? The G9Girl name sounds like it would sell well over here.

I've downloaded the pdfs and plan to print them out ... however, I think colors are going to be a problem.

As for a book, that is actually along more of my line of work. Currently in Japan (and many parts of Asia) publishers and education material providers have missed the boat. They target EFL/ESL and have no clue what a student needs in this country. So, in short, the market is wide open to a line of books that can be targeted to the English conversation crowd and more than likely the early learners. However, even Dr. Suess and Bernstein Bears just don't do it either....

My background here in Japan is children's education, English, and some other side things I did for fun.

[Jeff Alton]

LT cothes are great. My son wears them nearly every day!! Now if Shaun would only let me pay for them he could make some money......

Cheers