Welcome to the Impact Podcast. I'm Eddie Wilson, here to help you visualize what others cannot see. Create opportunities where others have failed and push you to build empires where once there was empty space. Let's embark on this journey together and make a difference in this world. Ever thought about going into business with someone? You know, that's a scary proposition. Today on the podcast we're going to talk about the partnership paradox. The question I get asked more than any other question on social media is are partnerships a good thing? What should it be cautious of? What should I look for? So today I'm going to give you a very practical episode on when going into partnerships, how to make sure that you build them for success and not allowing them to move into failure. Today the podcast is called the partnership paradox caution and clarity in business alliances. You know, great partnerships can scale empires and bad ones can sink ships. The right partner multiplies your mission. The wrong one multiplies your mess. The right partner multiplies your mission. The wrong one multiplies your mess. So let's get into it. So let's talk about why partnerships fail and we'll talk about the failures of them and then ways to prevent failure. As a way of introduction, many of you know that I've done, I've had success in business alone. I've had success in business and partnerships and currently I'm in a partnership with a guy by the name of Andrew Cordle that many of you already know and an organization called collective influence. The way that we started that partnership was very, very intentional. It was with a lot of forethought, a lot of conversations ahead of time and I'll give you essentially the roadmap of how we created a partnership that is scaling our business today. But let's jump into why partnerships fail. If you go without clarity, you'll end up with conflict. If you go without clarity, you'll end up with conflict. Most partnerships start with excitement, with passion. You've got this idea and you think, man, this person essentially fits this gap in my life. And so because they fit a gap in my life, I'm going to pull them into this opportunity and you jump into the opportunity with passion, with desire and you jump in without clarity. And when clarity is not present, conflict will jump in, right? So like anytime there's a gap in clarity, oftentimes either negativity or conflict will jump in. One quick tip for those of you leading your organizations, I always say that where there's an absence of communication, negativity will fill the void. When there's an absence of communication, negativity will fill the void. If you're not padding your people on the back, you're not telling them what they're doing in a positive way. If you're not reinforcing good behavior, oftentimes the human mind, the human experience will fill in that void, will fill in that gap with negativity. So if you're struggling with people fulfilling their purpose, taking the next step in their space inside of your organization, reinforce them. Don't allow the negativity to fill the gaps to fill in the void. Make sure that you're speaking. And the same way with partnerships where there's a lack of clarity, oftentimes conflict comes in. So anytime you're in a partnership and there's not clarity between roles, clarity between the two parties where you know exactly where going, where the end state or end goal is, what the roadmap is along the way, then oftentimes there's conflict because if you think about it, you jumped into the partnership because you felt like you were missing something or you felt like that person had something to add. But oftentimes what that means is that you guys are in opposition that you are opposites. You are bringing something to the table that's unique. When you bring something to the table that's unique, you bring a different flavor, a different flare. You bring a different mindset, you bring a different context, you bring a different style. And all of that breeds conflict if there's not clarity and where you're headed and who has what responsibilities. Many partnerships start on an emotional connection, not the complementary technical values. You say like, man, there's this emotional connection. You're excited about where you're headed. And so you connect emotionally. Let me ask you, as those of you that have been in any relationship, is an emotional foundation, a good foundation or is truth and information a good foundation? And that's where partnerships start and the failure begins. The number one failure though in partnerships are assumed alignment without defined roles. So we just assume that because you're good at this and I'm good at that, we're naturally just going to do this together and you're going to fulfill your role. And I'm going to fulfill my role. And that's just now how it works. If you start your partnership that way, then you ultimately are going to fail. And by the way, partnerships are more than just business partnerships. It can be relational partnerships. It can be any type of partnership. And so the number one failure is assumed alignment without defined roles. Let me give you just some red flags because some of you've already jumped into partnership. You're stuck. And I'm going to help you get unstuck number one. Also, if you haven't created a partnership, I'm going to give you some guidelines for the pathway to make sure that you don't fail. But here are some red flags. If you're in a partnership that needs more definition, you have undefined decision making rights. No one really knows who's in charge and what decisions get to be made by which partner. Number two, uneven value creation or capital input. So like if one person is putting a bunch of money in and the other person is not or one person is putting the money and the other person's putting in value, we need to create the correct value exchange. If not, bitterness and frustration sets in when one person's providing capital, the other person's putting in sweat equity and we don't have a value exchange that's already predetermined. That's a red flag. Number three, a lack of operating agreement or a bicell clause. If you have an operating agreement, but in that operating agreement, it doesn't take into consideration the exit of the partnership. That is a huge red flag. And evidently, you are going to go different directions. Very few people can be the the Warren Buffets and Charlie Mungers of the world where they just stay together for a lifetime and seemingly just have the perfect partnership. Most partnerships go the opposite way. I've read a stat that says somewhere between 92 and 98% of all partnerships fail at some point. That's business related, obviously. But if you go to relational, over 60% of marriages ended in divorce right now in the United States. So again, partnerships that are undefined oftentimes lead to failure. Lack of operating agreement or bicell clause. And then the last red flag that I want to bring up is one partner is full time and the other one is visionary only. One's just bringing information and ideas and the other person's putting in all the work. That doesn't work. Both people have to put in equal equal value. And that value has to be predetermined. So those are some red flags. And so if you partner because you need help, then oftentimes you have to define what that help is. For me, I've gotten to a place in life where I don't partner because I need help. I partner because I want acceleration. I don't partner because I need help. I partner because I want acceleration. If you go back to I just said a few minutes ago that I have a partnership with Andrew Cordell and I formed this partnership about three years ago. Not because I needed help. I was semi-retired. Andrew was semi-retired. We partnered because we wanted acceleration. Andrew's an extreme visionary. I am someone who can take vision and bring it to life. And what I realized is with his vision of doing something big or something great, I could bring that piece to life. I could actually put a feat to the mission. I could actually make those things happen. And so instead of partnering for help, we partnered for acceleration. I gave you the red flags. I gave you the cautions. But here's the benefits of a great partnership. So when you're thinking, should I partner, here's some of the benefits. If you want to go fast, you've heard this statement. If you want to go fast, go alone. If you want to go far and stay sane, go with the right partner. The actual quote is if you want to go fast, go alone. If you want to go far, go together. And I would say if you want to go far and stay sane, go with the right partner. Key benefits of a great partnership. Number one, complimentary strengths and blind spot coverage. You know, like each one of us have strengths and liabilities. And oftentimes our strength carries to success, but our blind spots are what causes pain along the way to success. You know, it's not knowing the issues or the frustrations that we cause other people. If you go back to a podcast that I recently did on Mark, are on Julia Caesar, and how Julia Caesar had the hero syndrome where he rose to power quickly and then ends up being assassinated by his best friend, right, Brutus? And it was a tale of how someone's strength and get them to amazing success, but it ultimately leads them to extreme failure. So with a good partnership, complimentary strengths and blind spot coverage, however, you have to have a strong enough partnership that you can discuss each other's blind spots, total truth. I would say that there's a need in any partnership. And this could be marriage. This could be business. But there's a need for radical honesty, a need for radical honesty. If you don't have radical honesty where you can just say what you need to say without repercussion, then you don't truly have a partnership. If you do not have the ability to tell your partner, right, someone who is your equal, someone who is there to support you, someone that is there for complimentary strengths and blind spot coverage. If you don't have the ability to be honest with that person, radical honesty, then you don't have a partnership. That's not a partnership. Faster scaling through divided roles, you know, like what I said is it's important to choose partnership based on this desire or this passion to accelerate not to just fix something that's wrong in your life, right? Faster scaling through divided roles. Oftentimes you have people that are great at offense and people that are great at defense. I would say that the offensive side of your business is sales, marketing, vision, leadership, the defensive side of your business is oftentimes operations, finance, human resources. It's all the things that keep you safe. You have to have both represented in the company and oftentimes great partnerships represent those that can play offense and defense equally. Emotional resilience and strategic sounding board, right? So one thing that I've had issues with in my organizations as I was a growing entrepreneur is I want to share my ideas with everyone. And so I walk in and I just unload my ideas. I throw up my ideas on the people and oftentimes they're already overloaded. And somebody in an organization where you're driving and you're pushing, your people can get fatigued. And so what you have to do is you have to temper those ideas. Well, a good partnership allows you to share ideas together without ever creating fatigue to the team. Andrew and I've had lots of crazy ideas that have never ever seen the light of day or have been communicated down to the level of the employee because if so, if we were just Andrews and extreme visionary. So if literally they just got all dumped on the team, they would be overloaded. They'd be fatigued. And I have to be very cautious to not bring every idea that he and I bounce off of each other to the team so that I don't create fatigue. They're already fatigued enough as we're growing these companies. And you add that additional pressure and it's too much. And then last, shared capital, credibility or client networks. Those are great reasons for partnership, shared capital, credibility or client networks. Partnerships, here's a rule I want you to think about. Partnerships only work when both people bring a brick. So this is an interesting concept. If you've if you followed along with my empire operating system or the end of the empire teachings, I talk about the singular KPI that drives everything. It's the strength of what you do. And so each person as you come into the organization needs to bring something that you fundamentally do well. And you have to hold to it. And each one has to honor the value of the other. Right? And so you bring a brick. If a partner doesn't bring a brick or a key metric that drives the business, it creates friction and failure. All right. So let me give you the boundaries. Okay. So I gave you the benefits. I gave you the cautions. Let me give you the boundaries that make or break a great partnership. This is something that if you are taking notes right now, I would highly recommend taking notes and abiding by this as a roadmap for partnership. If you're not come back and listen to this podcast every single time you consider to go into partnership because this will this will help you avoid great heartbreak, right? Great partnerships feel like an amazing opportunity. They they create massive growth and pat but in the end, they cause massive heartache and massive issues when they don't go well. All right. You ready? Here is the boundaries. I'm going to give you five boundaries that make a great partnership. Do not violate these. Do not violate these or it is at it is at your own peril and your own risk. Okay. Number one, great partnerships. Number one, define the mission. We should be mission first. Missionality is so critical and key because when you have differences, when you are at odds with each other as long as the mission is aligned, you'll find your way back together. Mission has to be first. Okay. Mission is why are we partnering? It's what's our shared vision and shared timeline. When Andrew and I came together this last time, we talked about impact others. He pitched me on an idea, the aspire tour, collective influence, a lot of things that you see that have come to life today. But the one thing that we are aligned on was these all have to point to something greater and that something greater was the nonprofit that I built called Impact Others. Impact Others does feeding centers and orphanages. We maintain those orphanages well. We have educational programs for children. We do clean water projects and we build sustainable businesses. This was all fundamentally built and in operation long before Andrew and I partnered. So what we did was we said, Hey, that's the North Star. That's why every community we have or we've built focuses on impact others. We have a gala twice a year to draw attention to that mission. Every single aspire tour we start off with talking about impact others in our a lot of our corporate meetings. We talk about impact others, right? Our goal is to further that. And if you listen or you walk into the front doors of our organization, you'll see a big mission statement at the end of that mission statement. It says all that we do inside of our business is to lead to feeding a hundred thousand feeding and educating a hundred thousand kids a day, right? Like it's like no matter what we choose to do, right? And no matter what odds we're at, Andrew and I could be budding heads. But in the end, impact others is the mission. So define your mission. Number two, assign clear roles. What are you going to do and what is the partner going to do and write them down and agree to them? You have to assign clear roles. You can't just leave it ubiquitous and open and say whatever happens happens, who owns which outcomes, who makes the final call in each area, define your roles. Define your roles. Number three, document everything. This is where so many partnerships fail is that you have conversations without documentation and conversations without documentation are left to interpretation. Let me say that one more time. Conversations without documentation are oftentimes left with interpretation. Interpretation is the thing that drives all conflict. So your equity, responsibilities, conflict resolution, when you guys have conflict, follow up with an email, have somebody sit there, use AI, whatever it is, but make sure that you are documenting these things, voting rights, exit terms, capital contributions, all these things have to be documented. You can't just say, hey, you know, I'm going to put in this much, you're going to put in this much. No. Capital contributions have to be documented. Number four, regular check ins. Regular check ins. Think about it. If you're in a relationship with somebody and you never have open conversation between the two of you and you're just going about it, then what happens is as you begin to just slightly diverge, right? It's like that idea of like if you're going from, you know, Florida to New York City and you're only one degree off, you know, when you start, if you're one degree off, you could end up in Chicago or something, right? Like, I mean, you can end up completely sideways at the end of the mission. And that's what happens is that constant pull back together through regular check ins. In Empire, we oftentimes, we call that the same page meeting or these weekly tactical meetings where we actually sit down and talk about it from a partnership standpoint. And then quarterly vision alignment. I am such a firm believer in every quarter, we have to realign where we're going. Not the mission. The mission stays the same. But the fundamental pathway towards the mission, I believe should be a quarterly pursuit. And number five, this is the hard one because nobody wants to do this, but it is vital is you have to plan the exit before you start. If one of us wants out, how does that happen? You have to ask that question, build the off ramp before you ever get on the highway, build the off ramp before you ever get on the highway. In the end, partnerships should be there to support you, to build you, to help grow. But in the end, they shouldn't be there to harm you. So have the hard conversation in the beginning and talk about the exit. If one of us wants out, what does this look like? How does that happen? Is there a buyout? Is there an exit pathway? Create the off ramp before you actually build the highway or jump on the highway? Okay. And so those are the five cautions. Let me just read those to you one more time. Define the mission, assign clear roles, document everything, create regular check-ins and exit before you start. Create the exit path before you start. Let me just give you one example that I think is a stellar example of a partnership that built something and then in the exit allowed for the success of the company. Okay. So I talked to you a minute ago about a phenomenal one, which is Warren Buffett and Charlie Munger. I mean, these guys were together until Charlie just died. And what an amazing partnership that they had. I mean, they were obviously very complimentary, very smart and brilliant in and of themselves. But what a great duo. The second one I want to bring up doesn't have such a rosy ending. It's Steve Jobs and Steve Wozniak. Steve Jobs and Steve Wozniak are the founders of Apple. There was a third partner that exited early, early on. It was bought out and what a horrific story that is because he was bought out and then missed out on the billions of dollars. But Wozniak was this technical builder. He was the guy that was the technical side. Jobs was the visionary guy. He was the marketer. He understood how to raise capital. He was one who was out talking and rubbing shoulders with people. And these two guys got together to build the very foundation of Apple, right? They had early success. They had amazing success because their synergy of Steve of Wozniak actually being able to build what was in the head of Steve Jobs allowed them to build this very first computer. And these two had amazing early success. The problem was is that partnership was not built for scale. Steve Jobs was a visionary. They say he's a very difficult person to work with. Oftentimes you'll find more of his former employees who don't necessarily say negative things. They just say that he was extremely hard to work for and that they couldn't work there forever. But he was forced to be reckoned with. But he was that visionary leader, the marketer. He brought the capital. The partnership was not built for scale though. Wozniak became disconnected from the business vision. Wozniak was hyper focused on that early vision of every home should have a computer, but was very focused on that. Jobs wanted to expand the product offerings. He wanted to give different variations to different people. And Jobs really wanted to create a different future for computing, right? And then Jobs eventually takes over control. The lesson is, this partnerships may not work or they may work in one season, but they must evolve or be restructured for scale. If Wozniak and Jobs end up together for the long haul, I do not believe that Apple would be what Apple is today. I think that their conflict would have prevented them from the success that it could be. I think that Steve Jobs, visionary leader saw something that Wozniak did not. Wozniak was building for the vision that he could absorb or he could have assumed. And in the end, Wozniak stepped away, which I think was the greatest gift he ever gave to Apple. I don't think it was his technical ability. I think it was his understanding that his own limitations prevented Apple from getting to where Jobs wanted it to go. And I think that that's important is when you realize that your own limitations are holding back the organization from a partnership standpoint, it's time to walk away or it's time to find a contribution that is commensurate to what you bring. Apple survived because the company was more clearly defined than the partnership was. In the beginning, they struggled and they really struggled to get to a breaking point. And they may have even had some conflict that essentially was brought to the forefront later. I had the privilege of speaking with Steve Wozniak on a couple different occasions. He spoke for an event that I held in Kansas City one time. I got the chance to pick his brain. And he said that the hardest thing that he ever had to do in his life was admit that what Steve Jobs was thinking or what Steve Jobs was dreaming of, he didn't possess the ability to take it there. He said that was the hardest thing. And in the end, he made the right choice. He walked away. He walked away to his benefit, right? Like Steve did not lose a bunch of money or Wozniak did not lose a bunch of money. He walked away properly. He supported the vision of Apple moving forward. He went on to do his own things. He's been a success past his pointed Apple. But it just shows the strength of a man who's willing to walk away. Steve Jobs also, it shows the strength of a man who is determined towards his vision, who refuses and is relentless to allow the vision to be impaled or to be pulled back by someone who is not able to contribute at that level. To me, that's a successful exit, right? Now you see the benefit of Apple taking the next step. A partnership is a force multiplier. It can be exponential. It's not 1 plus 1 equals 2. A partnership is 1 plus 1 equals 4. It's a force multiplier. It allows things to move faster, quicker, allows you to see each other's blind spots, make adjustments on the fly. But only if it's forged in clarity. And if you do not forge in clarity, it has massive potential for success. It has to be forged in clarity governed by principles and rooted in mission. Forged by clarity, governed by principles and rooted ultimately in mission. Mission will keep you on track, moving the same direction and help you avoid conflicts. So here's the call to action. If you are in a partnership today and you have not already asked the questions, your your takeaway should be number one, I need to go talk to my partner and we need to see if we're aligned on mission. What is our mission? What are we trying to accomplish? What's the end goal? Number two, you should be asking the question together, are we equally invested? Are we equally invested? This is a hard conversation, but have it. Have the conversation. Do you feel like I'm contributing as much as you do? Do I feel like you're contributing as much as I do? Are we equally invested? It could be a mixture of capital versus sweat equity, so on and so forth. And number three, do we have a written agreement? If you don't have a written agreement, you've got to go back and create that. It's just the step that's necessary for all partnerships to succeed. If not, don't panic, don't worry about it. Just course correct while you can. One thing that you could do is if you have a partner, you could say, hey, I was listening to this podcast today. I was listening to Eddie talk about partnerships. I was listening to him talk about good partnerships, bad partnerships. I was listening to Eddie talk about his own partnership and it really got me thinking, would you mind listening to this podcast or would you mind if I outlined this podcast for you and let's just talk it through? It's the easiest conversation starter, right? Like I'm giving you permission. Go do it because if you don't, again, what I talked about is where there's no clarity, there is conflict. Build the right type of partnerships. And then ultimately you can go back to what I was talking about where the right partner multiplies your mission, the wrong one multiplies the mess. Great partnerships, scale empires and bad one synch ships. Guys, thank you so much. Hope that help on your partnership journey or business journey today. Thanks so much for being a part of the podcast for listening today. I'd love to connect with you further and you can connect with me on social media at Eddie Wilson official on any of the social media channels.
