When one entrepreneur in Massachusetts decides to go into business with another entrepreneur and create a business partnership, the pair must think carefully about how they want to structure and run their business. In addition, their partnership agreement should clearly outline some potential exit strategies.
As Forbes explains, there may be many reasons that an exit strategy needs to be utilized. This may include a conscious choice on the part of one or both partners to part ways or it may result from an unexpected situation like the death or disability of one of the partners.
The Houston Chronicle recommends that exit strategies be created to accommodate both planned and unplanned events. This will give the agreements maximum flexibility and provide the best level of stability and support for the business during such a transition. Exit strategies may involve selling the business to one partner only, selling the business outright or passing part of the business on to another person.
If leaving one’s share of a business to a family member is a consideration, this should be discussed openly not only with that family member but also with the partner. This type of planning may also involve updates to a will, trust or other estate planning tool. It may even be possible that the family member who is identified to take over part of the business might want to start working with the business prior to becoming a partial owner. This may give that person and the other partner an opportunity to work together in some capacity to determine their future compatibility.