Get Rid of Your Dud Business Partners

October 25, 2006

As a kid I used to create crazy milkshake concoctions with half the ingredients in the fridge. Toss it all in the blender, churn it up and voila. (I’m sure I wasn’t alone in that right?)

Usually…it tasted like crap.

Partnerships are like those crazy milkshakes – there’s a ton of ingredients and they often sour. Combine personalities, skill sets, goals, egos, vision, ownership stakes, risk tolerance and a whole bunch of other things. Stir like mad and that’s a partnership.

Partnerships are hard.

Almost anyone that’s ever worked with a partner has a story to tell. Often, a horror story. The worst case is the “dud partner” — a partner that doesn’t pull his/her own weight.

Do you think it’s possible to carry dud partners on your back and succeed?

I used to. Now, I’m not so sure.

I’ve had a couple “dud partners” in the past, and I’ve learned:

It’s best if you get them out of the business as soon as possible.

  • The longer you wait, the harder it becomes.
  • The longer you wait, the longer it’ll take to right the ship.
  • The longer you wait, the more frustrated you’ll grow. That’s not healthy.
  • The longer you wait, the less likely your business will succeed.

Having the conversation with a partner that starts with, “I don’t think this partnership is working…” will be anything but easy. There’s ego, personality, history and a bunch of other things mixed in there. It could get ugly. It could go smoothly. It’s a case-by-case basis.

But ultimately, you have to get rid of the “dud partner.”

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Comments
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  • killer_rb
    I have a dud partner. For the past 10 years the business has done well but I have outgrown my dud by more than double and i feel like I carry my dud now. Not only do I want to say goodbye to my dud I don't want to feel slighted anymore. I just have to find the balls to tell him.
  • We got a dud partner right now, we don't know how to tell her we want her out, some of our accounts are in her name, like our Dell account for our computers, which we still owe money on and such. She is just completely abandoning her responsibilities. I went to the studio today and found unopened bank statements, deposits not recorded, my other partner and I never see any bank statements, she has no idea how much we have in the bank, will not take any of our phone calls...I could just go on and on. We gave her so many chances to get her act together it's not even funny anymore! She is a real boat anchor right now and is ruining our business. Anyone out there-Please help!!!
  • gabrieleurope
    Hi Ben,
    Ive been reading your comments and found them insightful....and im in the same position. I started a business with a workmate of mine....big age difference as i am 23 and he is 55. But I have to say that I have put in more work and effort upto now one year on. in Janurary we took on a investor, so it is not split 3 equal ways, the third partner being a silent one. The problem is being my original partner...is not putting in effort..not getting sales which is his part to do...he is not interested in customer service..ignoring calls etc...and now i actually think he is taking money from the company by doing cash sales without my knowledge. The whole problem except from the taking money is....he has not got the motivation to take the company where I want it to be. Maybe it is a age difference....maybe he has lost interest....But i need to get rid of him.. I need help....It is driving me mad and daily giving me headaches and stress, i am even at the stage now where i cannot bear to talk to him....help please!
  • Kim
    @ Ben...
    You seem pretty knowledgeable so I thought I might ask you a question...
    I had a 40% partner (10% belongs to my husband and the other 40% to me) that has fallen off the wagon with a drug dependency and so many personal problems that she has lost control of her life and walked out of the business. I have not heard from her since.
    Do I need an attorney to take her off the LLC?
  • Kim - I honestly don't know, nor am I in any position to offer legal advice. My recommendation would be to see a lawyer to find out what has to be done. See two lawyers, if you want different opinions / options. Good luck. You're in a very tough spot which can't be fun.
  • @cindy: Honestly, your brother should get a lawyer.
  • cindy
    my brother gave a friend of his 15% "sweat equity" in his business 8 or so years ago. Since, the business has grown by leaps and bounds. However the "sweat" partner has become increasingly dead weight. At every turn he refuses to grow/cooperate and at times he's cut cash side deals without my brothers knowledge. I know because I run the office. There are no contracts but his name is on our corp checking account and I see his tax doc's come in from our accountant stating his 15%. He pays nothing, he is a complete screw up and my brother says that there is nothing that he can do to get rid of him. Which stresses my brother out. Any ideas?
  • ad
    I need some advice please. I have a business partner who came into business with me over a year ago.I said i would sell 50% of the business to him once he has paid me the proporate amount.So far i have not recieved a penny and in the mean time he is taking half of what we make each day. it's got to a point where he is trying to take over by either, being all nicey nicey to the landlord( who i rent the property from) and by trying to undermine me. the council tax is in my name and all the other bills. the problem i have is that i only have a month to month lease with the landlord, he will not give me a longer one. obviously he has the power to kick me out,and when i go down the route of trying to get rid of my dud partner, i might end up nailing the final nail in my coffin, as the both of them have formed a friendship. i have a written contract from the man i bought the business from,it clearly says i own 100% of the business. how should i go about getting rid of this 'dud' partner??
  • ian richmond
    what do you do with a partner that says he is ill and has put in no effort to do any work for more than 6 weeks can i have an accident at work and accidently cut him in half... jk
    frustration anger bewillderment shock dire straights all of the above is what i feel trying to get that through to him is like knocking a house down with a screwdriver....
    i have a property maintanence co and he is supposed to be the grafter and i am to liase with the client and get work in and generally do the paperwork and he is supposed to do the work but he doesnt ... and i have to end up getting others in and pay them to do his job
    aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaahhhhhhh
  • That's a tough story, but one I suspect that's quite common. Big issues often arise when 1 partner puts in sweat equity and the other puts in money.

    No matter how important the sweat equity, the guy putting in the money is going to feel his share is more important. In some ways it is - without the money, it doesn't matter how much work was done (maybe), but it sounds like you found him a good offer and he should have been smarter about it.

    People (and not just in business) often don't see what's right in front of them. You're the guy walking away with employees and clients - he'll be left with a lot less than what he had, no interest in putting more money in, and likely a failed business. People can be very shortsighted.

    Good luck, and hope to see you around here some more!
  • partnerssuck
    Ben:

    Thanks for the great post, glad to see I am not the only one going through this.
    Here is a crazy story for you.
    In the past 3 months after seeing a nother one of my partners Business relationships going sour and how insane he was in that case, I decided to start to part ways. I tried taking the high road and got an investor to make an offer on my partners shares. My partner invested money in the company and I invested the time. The offer he claims was not much of an offer it was his investment plus 100% ROI that totaled $300K. The company only launched 16 months ago with most of his investment money being put in around the last 8 months. His claim was that I am trying to screw him out of the business.
    At this point I am walking away from the company, taking all the employees who dont even know my partner, and the clients who dont know him. He doesnt want to buy my shares or invest more money in the company and he has left me no choice.
    Being tough is sometimes the only thing people understand.
  • MV - that's a touch question, but one that everyone wants an answer to. "What do I do with a dud business partner?"

    The problem is that each circumstance is different.

    Do you have a contract between the two of you? Do you each own 50% of the company in something more than a handshake agreement?

    If you told him to leave, would he? Would he need to be bought out? Is it worth letting him keep his equity (assuming he owns some) but having him be a "silent partner"?

    There are tons of different ways of tackling this problem, and yes, some are legal, but a great deal depends on what you current have in place legally.

    If you want to email me directly, feel free. Or feel free to comment here - might be a great exercise for everyone to follow.
  • ST
    So what was the outcome of this situation? I am in a similar predicament. My partner and I are 50/50, she has done nothing since we started a year ago. I maintian all of the day-to-day operation of the company and handle all of our clientelle. I plan to approach her today and tell her I want her out, but I'm not sure how easy it will be.

    Any advice?
  • There's no easy way to get rid of a partner or quit in a situation like that. Best thing you can do is get it over with so it doesn't fester any longer. Good luck.
  • mv
    I have a dud business partner currently, we both invested the same amount of money into the business and he has maybe worked 4 hours in the last four months at the business, Is there any legal recourse i can take against this person, to help him find his way out the door? I am having to pay for things from my own pocket because of his lack of working at the business thus making me have to hire and pay someone to do his share of the work.



    thanks
  • Whitney - Thanks for the story! It shows you that most people in their work-lives deal with difficult business partners. Whether it's writing a book, starting up a new business, or what have you...it's a common issue!

    Bill - You're right. I think people jump into partnerships too quickly cause it's easy. But it's risky and people forget that. It can be tough to "look at the negative" when you're starting something new ... it'd be like writing up divorce papers at your honeymoon, but it's important to think on all sides of the proverbial coin when getting into a partnership (geez, more metaphors and more post ideas!)
  • One of the ways of getting around getting into equal partnerships and giving up control is to get into strategic limited alliances and collaborative engagements. In these arrangements, you get to keep control. Also, these alliances are much easier to sever.
  • Boy! Isn't this the case! I started the infamous book project with a partner who acted more as an obstacle to progress than as a partner, andbecause we were close friends, it took a long time, and numerous conversations of "This is working for me... You don't seem to be committed to the project... This isn't a priority for you... etc." until it finally got to a point where I said- I think you need to wrok on your own project and I'll work on mine. I started podcasting and having a bit of success, and she's still running in circles and getting nothing done, but I don't have to watch or be slowed down, waiting for her to do SOMETHING. Best thing I ever did; I waited WAAAY too long to do it, and it was hard. But being realistic, even if it did cause our friendship to change, we did it before I ended up really destroying the relationship with my frustrations and growing anger at her for not doing what she said she would. She really just wasn;t capable of doing it, and it just took me way to long to realize that was the case.
    Whitney
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