- Player: Greg Tinkler
- Company: Cre8tive Group
- Est: 2009
- Contact: firstname.lastname@example.org
- Visit: cre8tive.co.za
Serial entrepreneur Greg Tinkler has started a number of businesses over the last eight years. Some have failed, others like The Cre8tive Group, one of South Africa’s biggest brand activation agencies in sports supplements and pharmaceuticals, have grown into thriving companies. What all of these ventures had in common is that they were built on partnerships.
We recommend: Getting Partnerships Right: Lucid Holdings
“I have had some great partners and some who were not so great,” he says. “But I feel there is a place in business for partners. There are those who can inject cash into your business, or bring in skills you don’t have. However, it’s extremely important to choose carefully.”
We asked him to share some candid insights from his most recent foray into a new business venture – one that failed, but gave him some deeper insights into how partnerships should work.
What was the background to the new partnership?
Late last year I started a new business venture in sports management, an industry I know well.
I needed a partner who could inject some cash into the business so that we could compete with more established agencies, and who also had corporate connections so that we could raise sponsorship revenues.
I approached a long-time mentor with the idea and convinced him that it was a winning strategy.
Why did the partnership fold?
The business never took off and it was a trying time for both of us. My partner grew frustrated with the revenue leaking out, and I was disappointed with the lack of support and time he was giving to it.
Basically, we made the mistake of failing to manage expectations from the start.
As a busy man with multiple businesses to run, he was looking for a partner who would manage the business and bring in the revenue and returns; I was looking for someone who would invest sweat and energy.
A valuable lesson learnt is that before you sign off on any business partnership, you need to outline exactly what each party is responsible for and how much time each partner can provide to the business.
I also learnt that mentors do not always make good partners. My mentor is an exceptional business person who is extremely successful, but I was unwise to think that teaming up with him would automatically make my idea a success.
Did you have agreements in place to protect your interests?
Yes. After assessing if a partnership can work and outlining all expectations, it is imperative to have a professional partnership agreement drawn up. I recommend using a legal professional to do this. It can be costly, but it will save you a lot in the long run if there are any issues to resolve.
A partnership agreement should contain the following:
- Percentage of ownership (who owns what stake in the business)
- Allocation of profits and losses
- Expectations, designations and roles
- A buy/sell agreement to manage what happens in the event of the death of one of the partners
- A dispute resolution mechanism to manage what happens if you don’t agree on a key business decision (I suggest a mediation clause).
What would you do differently in future?
Don’t get into a business venture purely for profit and do not just take on a partner because they have capital.
How did you recover from this setback?
Because it was a mutual decision to part ways, there was no real harm done other than the knock to my ego.
I went back to the drawing board and looked at how and why the partnership did not work, and then set about crafting a new strategy to make the business happen. I have decided to continue on my own.
It will probably take longer to reach the goals I’ve set down, but I am doing it at my own pace, with the right drive – and that’s what counts.