The art of choosing the right business partner
Getting into business with people you know well might make for a harmonious partnership, but it might not be the necessary collaboration that will produce a good outcome
It always starts with an idea. Something so brilliant and unique that you feel success is imminent. The idea is pitched to a group of people whom you feel would willingly back you—financially or otherwise—on this venture. Ideally, you all get along and together enjoy the rewards of a thriving establishment. However, as many would attest, not all business partnerships bear fruit and have that fairytale ending.
While no one never really knows how things will turn out in business, a good start never hurt anyone. Finding the right partners in a restaurant venture makes navigating the dynamic industry a little more manageable.
BIRDS OF THE SAME FEATHER
“Never do a free-for-all,” warns restaurateur Carlo Gordon Lorenzana, whose successful partnership with his siblings in Taiwanese teahouse chain Shi Lin allowed him to sprout other lucrative ventures such as third-wave café Single Origin and Japanese-Peruvian eatery Nikkei. He is set to open two more outlets, a bar and an osteria, before the year ends.
By “free-for-all,” he means an open invitation to anyone who is in interested in investing in the business. “Pick people who are professional, not childish,” he stresses. Food industry insider JJ Yulo, part owner of the now-defunct food hall Makansutra, echoes Lorenzana’s advice. Yulo says that he would look for someone “I can trust and rely on; who knows what they’re doing; and most importantly has the same values as me.” This probably explains why, in his long-running food events business Pinoy Eats World, he counts wife Cres Yulo as one of his trusted partners.
ALL IN THE FAMILY
People warn against getting into business with friends and family, but both Yulo and Lorenzana do not seem to mind. “Honestly, if they’re up to the task and you think you can communicate well with them,” Yulo points out, “it’s worth a shot.” Lorenzana partnered with his older brothers in Shi Lin; and now that he has his hands full with the other restaurants, he has since chosen to let the others run the show. “In our family, there are no issues because there is respect,” Lorenzana says. “My eldest brother James has the most interest in Shi Lin since he made the largest investment. So, when it comes to Shi Lin, we let him have the last say.”
But the restaurateur cautions that, while a harmonious partnership might make for a pleasant ride, it might not necessarily be the ideal vehicle towards progress. “Of course, if everybody is just happily getting along, nobody is questioning or challenging the decisions made,” Lorenzana says. “There’s really that tendency to become stagnant.” Therefore, while not stepping on anybody’s toes might seem like the right thing to do, voicing clashing opinions or playing devil’s advocate when needed would not hurt. As long as it is done respectfully and maturely.
Even when getting into business with people you know well, these entrepreneurs insist on the importance of a formal agreement. “Everything needs to be in black and white,” Lorenzana says. “You’ll never know what will happen in the future. With different people involved, there will always be contrasting opinions.”
Yulo lays down a few red flags to watch out for when choosing business partners. “If it’s all about the money,” warns Yulo, “if they don’t have a problem being sneaky and using people, if they freak out a lot; I don’t work well with people with tempers.”
When picking people to work with, there is a lot of trial and error. Sometimes even the most ideal relationships turn sour when friends decide to work together. When disagreements arise and the differences seem unresolvable, Lorenzana advises that it is sometimes best to just give way. “Just buy the partner out,” Lorenzana says. “Or sell your shares to a third party. When your partners are magulo, there’s no shame in walking away.”
As for Yulo, he could could not stress enough how matching values are important in building a solid partnership. “I cannot stress that enough,” he reiterates. “And you have to have the same vision.”
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