Your spouse/ partner may be your soul mate and confidant, but starting a business together doesn’t always produce the best outcomes. Here’s what you need to know to protect yourself and your relationship before tying the co-working knot.
Going into business with the person that you married may seem like a great idea but it doesn’t always end up in happily ever after. Some recent high profile divorces and business splits may make you think twice before you tie the co-working knot.
Take the nasty break up between fashion mogul Tory Burch and her ex-husband Chris Burch, which resulted in a series of lawsuits and counterclaims only to be settled in January, years after their 2007 divorce. Chris helped launch her fashion label and co-founded the company, Tory Burch LLC, in 2003.
After their split, Chris launched his own clothing line, C. Wonder. He sued the Tory Burch company, claiming they were hindering the sale of some of his stake. The company countersued calling C. Wonder a “knockoff brand” with “lower-quality, mass-market versions of the Tory Burch brand.”
In the end, Chris sold part of his share in the Tory Burch company in January 2013, making his ex-wife one of the newest — and the second youngest self-made woman billionaire in America –on the Forbes’ list. Not a bad outcome.
Zara Fashion Split
Another billionaire on that list is Amancio Ortega, who this year jumped up the rankings to become the third richest person in the world. Ortega and his then wife, Rosalia Mera, started a clothing company, Intidex, making dress gowns and lingerie from their living room.
What happened? According to Enrique Badia’s book, Zara and Her Sisters: The Story of the World’s Largest Clothing Retailer, the spouses started growing apart after the birth of their second child Marcos, who was born with a developmental disorder.
Mera gave up working in the company to take care of their son. Not too long after, rumors started flying that Ortega was romantically involved with other women. Eventually, he admitted to fathering a child with one of his workers and the marriage was over.
When the couple divorced, Badia writes that Mera decided to leave the leadership of the company to her ex-husband. Although Mera is still considered the richest woman in Spain and has started the Paideia Foundation that works to integrate people with physical and mental disabilities into society, the disparity of wealth between her and her ex-husband is huge.
Situations like these are not uncommon especially when people are successful, according to Lisa Brateman, a New York City-based relationship expert, specializing in couples and co-worker relationships. “Men always end up on top that way,” says Brateman, “because women tend to defer to their husbands and in business relationships, the most dominant person usually takes control.”
In the last decade, Brateman says she’s noticed an increase in divorces among couples that work together.
So how do women protect themselves and avoid the pitfalls of running a business with their husband? According to Brateman, there are a few key rules everyone needs to follow regardless of how deeply in love they are with their partner. [pullquote]“You don’t necessarily want to sleep with your accountant” – Lisa Brateman[/pullquote]
Be honest with yourself
Before you even consider starting a business with your spouse, determine what you need in a business partner and ask yourself if you’d go into business with that person if you weren’t married. “If they answered honestly, much more people wouldn’t go into business with their spouses,” says Brateman.
Set the rules from the very beginning
Balance of power is the most important aspect of having a successful personal and business relationship according to Brateman. So before you start a business, make sure you discuss and set all the rules – from equal ownership, to decision making, to individual responsibilities.
Separate love and business
Don’t let love get in the way of your business thinking. “When [people] are in love, they think everything is great,” says Brateman. “Even though you feel that way in the moment, it’s important to think of everyone’s role in the business.” Success can change a person and their values, especially when there’s a lot of money involved.
Keep home and business separate
It’s probably one of the hardest things to do, but Brateman says it’s essential not to blur the line between business and marriage. Working with your spouse can be a slippery slope. As you spend more time with each other, business conversations tend to move to the dinner table. But it’s important to keep the business in perspective and not shift it back into your interpersonal relationship, affecting your intimacy. “You don’t necessarily want to sleep with your accountant,” Brateman puts it simply.
Keep the lines of communication open
“A lot of people don’t talk about things that don’t work,” says Brateman. “Married business partners need to be stronger than most married couples and have good conflict resolution.” To have a strong business and personal relationship, they need to talk to each other about things that are unpleasant.
Know your value
And last but not least: “women need to value themselves intrinsically,” says Brateman. Women often see themselves as the ones who are helping, but they should stop taking the back seat. “We can only do it if we stop accepting that [back seat] role and challenge ourselves.”