I am a transaction attorney, an investor and a founder. I have formed and I am a partner in many different business deals. I am presently in the middle of assisting two partners separate their business ventures. A business venture started out 18 months ago with visions of future wealth. Now, under the prism of pressure (financial and otherwise), I find this group at a point of barely speaking. How does a sound business deal end up with rational and reasonable people fighting like cats and dogs? My ultimate conclusion is that most partnerships (I use this as a generic term for any business venture with a group) succeed or fail based on relationships much more so than the underlying business deal.

I think we are all familiar with the story of Noah Glass based on the recent Twitter initial public offering. What fascinates me is that the story is not that uncommon. For more notable and recent examples, see Eduardo Saverin of Facebook fame and Frank Brown IV of Snapchat. What is truly uncommon are partnerships that last through good times and bad times. Notably, see Bill Hewlett and Dave Packard and Bill Gates and Steve Ballmer. In a wonderful article for the WSJ written by Robert Guth (ironically discussing tension between the two founders) there are wonderful instances of the great respect both men had for one another.

Although these are notable examples of both the good and bad, partnerships daily go through the turmoil and pressure of expectations, success and failure. I have found through my experience both as an attorney and a partner that a few key elements tend to make or (when they are lacking) break a partnership. They are, in my humble opinion:

1. Respect. Not simply respect driving down a one-way street, but mutual respect. Listen, it is not uncommon for partners to each bring something to the table initially. I have found typically there is the money guy, the idea guy and the “get shit done” guy or some combination thereof. In the beginning, respect is present because it is required for each partner’s self-interest to attempt to come to fruition. What I mean is that each partner outwardly shows respect because he needs the other partners…he needs the idea guy or the money guy or the get it done guy. As time moves on, one or more of the founder’s reason for existing goes away. The money guy can no longer get money, or money is easy and he is not needed. Or, on the other hand, the idea guy had his idea and now is expected to sit in the corner and stay quiet. A partnership founded on mutual respect of the person and not just what that partner can do right now, in my opinion tends to last much longer.
2. Honesty. This seems fairly straight forward and basic, but this (in my experience) is one of the hardest traits to find in a partner. People lie. It really is that simple. They lie for all sorts of reasons, many of which are self-evident. I have found the simple expression of “That is my fault. I am sorry.” goes a really, really long way. Stating these words are not easy. It is not easy to admit a mistake and own that mistake. However, those simple words build bridges that are strong among partners. I have always questioned the typical founder responses of “killing it”, “hockey stick growth” and “we are scaling”. Frankly, I do not even like the word “pivot” anymore. What I do like is an honest discussion among adults where mistakes are owned, addressed and set aside for more productive discussions.
3. Having Each Other’s Back. My grandmother use to say “Don’t air your dirty laundry where the neighbors can see it.” If you have an issue with your partner, speak directly to your partner about it. It is really that simple. If you gossip about your partner, they will find out.

The above points probably seem common sense to most people, but in my experience they are typically overlooked in the beginning because “we need the money guy” or we are all going to have so much money it doesn’t matter. Frankly, there is not enough money in the world that can offset a lousy partnership that you have to wind down. Trust me. Take stock of your partners in the beginning, not at the end.