How to Find the Right Business Partner

When starting a business, many entrepreneurs quickly realize the need for partners who can help their company get off the ground or later grow it to the next level.

A small percentage of people have all the necessary skills and experience they need to bring a product to market, sell it and manage their finances all on their own, says Steve Nielsen, founder and CEO of Partnerup.com. But more often, it becomes essential for small-business owners to find people to augment their particular skills and experience.

In many cases, though, finding the right business partner at the right time can be very difficult -- and the failure to do so can spell disaster for a company.

For example, in 2003, Nielsen came up with the idea for a radio frequency identification product. He talked about it to a friend of his who worked in marketing and business. His friend thought it was a great idea and soon the two of them started working on it and building a company.

"For a couple of months we were busy trying to get everything in line while we searched for an electrical engineer to actually design the product," Nielsen says. "We knew it was feasible and practical, it was just a matter of finding somebody who had radio frequency (RF) experience in an electrical engineering background."

Nielsen and his friend, he says, spent months searching for an RF engineer, who they could bring on as a third partner in the company. They weren't able to find one, though, forcing them to abandon the business.

A few months after the company had been dissolved, Nielsen stumbled upon an electrical engineer with RF experience who had been looking to for an opportunity to get involved in a start-up, but by that time it was too late.