There is only one good reason I know of to take on an investment partner. It’s when you don’t have enough financial horsepower to do the total deal by yourself. In other words, you need some help. Most often, it’s financial assistance you need. Equity sharing and timeshare contracts are two examples of partnership investing. Both arrangements are specifically designed for investors, who can’t purchase the whole “enchilada” themselves,
Always ask yourself these questions:
Do I really need a partner or do I just think I need one?
Is it wise for me to split my profits with someone else?
The answers should be very clear before you look for a partner.
My first thoughts when anyone approaches me with a partnership proposition are:
What’s in the deal for me?
What’s the risk to me and what assurances do I have that a partner will do what he says?
One Question you should always ask yourself is: What’s the most I can lose if I do this deal? Naturally, I’d be very concerned that my partner and I share equal risk.
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