Advantages & Disadvantages Of A Business Partnership

“When you shake somebody’s hand, it’s got to mean something,” says Marcus, who emphasizes the importance of drawing up a written agreement among partners. “I’m not a big fan of prenups in relationships, but I am a big fan of prenups in partnerships.”

Partnerships in business typically address fundamental issues, such as ownership and the roles and responsibilities of each partner. For instance, an agreement between two partners might split ownership 51 to 49 percent, with the majority partner running the business. The agreement may also specify the financial contributions each partner makes at the formation of the business, or later on when additional capital is needed.