Connect with us

Lessons Learnt

Greg Tinkler On Managing Business Breakups

Greg Tinkler from Cre8tive Group learnt the hard way that not all business partnerships are a match made in heaven: Sometimes, you have to call it quits.

Monique Verduyn

Published

on

Greg-Tinkler

Vital stats

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-tickWe 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?

Greg-Tinkler-Cre8tive-GroupThe 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.

We-recommend-tickWe recommend: Head Honcho Spurred Business Growth with Strategic Partnerships

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.

Monique Verduyn is a freelance writer. She has more than 12 years’ experience in writing for the corporate, SME, IT and entertainment sectors, and has interviewed many of South Africa’s most prominent business leaders and thinkers. Find her on Google+.

Advertisement
Click to comment

You must be logged in to post a comment Login

Leave a Reply

Lessons Learnt

#Wealthiest List: 8 Self-Made Millionaires On How They Built Their Wealth

These inspirational self-made millionaires built businesses with nothing less than hard work and sheer determination.

Catherine Bristow

Published

on

Prev1 of 8

1. Nick D’Aloisio Wrote a Million Dollar App At Age 15

nick-daloisio

At the age of 15, Nick D’Aloisio wrote an app while sitting in his parent’s bedroom in the UK. At the age of 17, D’Aloisio sold his app Summly – a mobile news summarisation app to Yahoo for a staggering USD 30 million.

As one of the youngest millionaires, D’Aloisio is also the world’s youngest entrepreneur to be backed by venture capitalists – having secured seed funding from Sir Li Ka-Shing, Hong Kong’s billionaire, as well as raising USD 1.23 million from celebrity investors, including Yoko Ono and Ashton Kutcher.

“The number one thing I did that I think was wise was to get, through some of my advisers, was a Chairman; basically someone who was a very experienced business person, an industry veteran — Bart Swanson, who had been at Amazon and then Badoo. Then, myself and Bart really started finding people and growing the team.”

Prev1 of 8

Continue Reading

Lessons Learnt

7 Cannabis Industry Millionaires Making It Big In The Marijuana Business

These entrepreneurs have capitalised on a new market set to continue to grow rapidly as more countries legalise marijuana across the world.

Catherine Bristow

Published

on

Prev1 of 7

1. Brendan Kennedy

brendan-kennedy

Brendan Kennedy worked on job sites as a carpenter to pay his way through university, with his eyes set firmly on becoming an architect, until the allure of Silicon Valley changed the course of his direction. While working at technology start-ups Kennedy began thinking about the possibilities that medical marijuana provided.

“I was really sceptical of medical cannabis,” he says. “It took a year of having conversations with patients and physicians and hearing the same story, repackaged but essentially the same, over and over and over again, where my scepticism eroded and I became a believer.”

In 2013, Kennedy and his partners applied for a licence from Health Canada and launched Lafitte Ventures, which was later renamed Tilray. Today, the company is a global leader in medical cannabis research, cultivation, processing and distribution.

Prev1 of 7

Continue Reading

Lessons Learnt

Scaleup Learnings From Our Top Clients – What The Most Successful Entrepreneurs Do Right

So, how do our successful clients move through these constraints to scaling up? We see four key drivers of success, and they are: people, strategy, flawless execution and finance.

Louw Barnardt

Published

on

business-growth-scaling-advice

You’re out of your start-up boots, staff is increasing, your client base is growing, revenue is up and you’ve proven your case to the market. Now it’s time to scale up. The challenges of this vital growth phase are different and it’s a time that demands different mindsets and different actions. In a world littered with small business failures, it helps to be well-prepared for scaling up using a proven methodology. At Outsourced CFO, we get an inside look at the success factors of our clients who are mastering the transition.

On the one hand, scaling up is a really exciting phase; this is what moves you into real job creation and making an impactful contribution to economic growth. On the other hand, it is really hard to scale up successfully. We see three major constraints that limit companies’ transition from start-up to scale-up:

Leadership

The business has to have the leadership that can take it to the next level. When you start scaling up, especially rapidly, the founders can no longer do everything themselves. The team must grow and include new leadership talent that can take charge and execute so that the founders are working on the business instead of in the business.

Infrastructure

The processes, procedures, networks, systems and workflows of the business all need to be scalable. This is imperative when it comes to your infrastructure for the financial management of your business. You’re only ready for growth when your infrastructure can seamlessly keep pace.

Market access

Scaling up demands more innovative marketing and storytelling so that you can more easily connect and engage with the new employees, clients, network partners, investors and mentors that need to come along with you on your scale-up journey.

Businesses that build a market conversation and a compelling brand narrative during their start-up phase are better positioned to have this kind of market access when they need to scale up.

People

It is critical to have the right people on your team. Our successful entrepreneurs have what it takes to attract, inspire and retain top talent. A strong team of smart, ambitious and purpose-driven people who love the company and want to see it succeed contribute greatly to a world class company culture. They are adept at communicating a compelling vision and establishing core values that people can take on. These entrepreneurs are tuned into the aspirations of their people and focus on developing leaders in their teams who can in turn develop more leaders.

Strategy

It is planning that ensures that the right things are happening at the right times. At successful scale-ups strategies and action plans are devised to ensure that the most important thing always remains the most important thing.

Strategy includes input from all team members and setting of good priorities for the short, medium and long term. Goals are clear and everyone always knows what they are working towards. The needle is continuously moved because 90-day action plans are implemented each quarter to achieve targets and goals that are over and above people doing their daily jobs.

Flawless execution

Top entrepreneurs are not just focused on what operations need to achieve, but how the business operates. They have the right procedures, processes and tools in place so that everyone can deliver along the line on the company’s brand promise. Frequent, quick successive meetings ensure the rapid flow of effective communication. Problems are solved without drama. There is no chaos in the office environment. Everyone is empowered to execute flawlessly to an array of consistently happy clients.

Finance

Everyone knows that growth burns cash. A rapidly scaling business faces the challenge of needing a scalable financial infrastructure to keep the company healthy. Our successful entrepreneurs pay close attention to finance as the heartbeat of the business, ensuring that everything else functions. They look at the tech they are using for financial management and for the ways that their financial systems can be automated so that they can be brought rapidly to scale. The capital to grow is another vital finance issue.

The best way to finance a business is through paying clients on the shortest possible cash flow cycle. However, when you are scaling up and making heavier investments in the resources you need for growth, it is likely that you will need a workable plan for raising capital. Our scale-up clients know the value of accessing innovative financial management that provides high level services to drive their business growth.

Navigating the scale-up journey of a growing private company is one of the hardest but most rewarding of careers to pursue. Having people in your corner who have been through this journey before helps take a lot of pain out of the process. No growth journey looks the same, but there are tried and tested methods that will – if applied diligently – lead to definite success. Happy scaling!

Continue Reading
Advertisement

SPOTLIGHT

Advertisement

Recent Posts

Follow Us

Entrepreneur-Newsletters
*
We respect your privacy. 
* indicates required.
Advertisement

Trending