If I’ve learned anything over the years, it’s that you should only do business with friends: with people you trust, admire, enjoy being around, and with people who make you laugh. Of course, there are good ways and there are bad ways of going about working with friends.

Below I’ve included four major things I’ve learned from trial and error about diving into working relationships and partnerships with those I consider to be my closest friends.

1. Communicate. Communicate. Communicate.

The importance of sincere, authentic, and frequent communication cannot be understated. This is always the case, and its importance is only amplified when working with friends. Often times, because you are friends, you may not want to be confrontational. In the short term, this may feel better, but in the long term, this is a recipe for nothing short of disaster (both for your organization and your friendship).

The importance of sincere, authentic, and frequent communication cannot be understated. Tweet This Quote

I’ve learned this the hard way and today, baked into the reality of all the companies I’m a part of is a disciplined “communication architecture.” I do weekly 1-on-1 calls with all my partners and teammates, together we do weekly tactical meetings, every day we do quick standing meetings, once a month we do 48-hour work sessions, and once a quarter we all go on a proper trip together for a longer retreat. The content of these meetings and calls is always around both what is good, and equally important, what is not so good. We talk about points of tension, points of gratitude, concerns, “yellow flags,” life beyond work, personal goals and aspirations, etc.

It may seem excessive, but I’ve seen this level of communication pay dividends and ensure that tensions never build up and that our team culture values authentic, frequent, and honest communication.

2. Vest your ownership.

Most co-founders start their companies by evenly splitting their ownership in the business between the friends they start the company with. This seems like the right way to go. But often, this ends up in a disaster. For example, if you start a business with your best friend and split the equity 50/50, what if one year into the business your friend decides to take a full time job on Wall Street? They will still own 50 percent of the company, and now that they aren’t actively working on the business, this will likely ruin your friendship.

If you and your co-founder’s motivations aren’t aligned, whether it’s in a few months or a few years, your partnership will undoubtedly fall apart. Tweet This Quote

Instead, I recommend you vest equity over a four-year period and install what is called a one year “cliff.” This means that if any of the partners leave the company within 12 months of starting it, they will not get any equity. If you go in 50/50 with your best friend and co-founder, and they leave two years into the company, then they would have just over 16 percent of the company instead of 50 percent. By planning not just for the best (which is what most friends do), but also for the potential of plans changing, you will save both your friendship and, likely, your company in the process.

3. Make damn certain your motivations are aligned.

A good friend of mine had a brilliant team behind a new startup, and everyone was motivated to make it happen. But when she sat down with her co-founders, she realized their motivations were not synchronized. Immediately, she listened to her intuition and decided not to continue with the startup.

If you want to live with your friends and co-founders, do so with an exit strategy in mind. Tweet This Quote

Typically with friends, it’s easy to dive into a startup opportunity or a working relationship that is exciting, fun, and potentially lucrative. But if your motivations aren’t aligned, whether it’s in a few months or a few years, your partnership will undoubtedly fall apart. It’s just not worth it. In short, make certain your motivations are aligned and if they don’t feel synchronized, don’t work together—just continue to be good friends.

4. Don’t live together for too long.

When founding the Unreasonable Institute, there was a period of time when co-founders Teju Ravilochan, Vladimir Dubovskiy and I all lived under the same roof. We would work upwards of 18 hours a day, 7 days a week, and being best friends, roommates, and co-founders meant we were together almost every waking minute.

Although it’s a fun way to start a new business, and it ensures you are all fully immersed, my feelings are that if you want to live with your friends and co-founders, do so with an exit strategy in mind (i.e. give it a set time commitment and after 6 months or 12 months, plan on living elsewhere). You will still likely see one another 16 hours a day, but giving yourselves just a little space is important for any relationship.

Working with friends is a lot of work, but it’s a great investment of time. Tweet This Quote

Reflecting on what I’ve written, I realize it sounds like working with best friends may be a lot of work. In some ways, to ensure the friendship remains sacred and the partnership thrives, it is. That said, I can’t imagine a better investment of your time. For me, I could never do what I do if it weren’t for the friends I consider myself lucky to know as partners, investors, co-workers, and co-founders.

A version of this post originally published in April 2014. It has been updated and reposted to inspire further conversation.

About the author

Daniel Epstein

Daniel Epstein

Daniel has an obsession. He believes to his core in the potential of entrepreneurship to solve the greatest challenges of this century and he has dedicated his life accordingly. Today, he is the founder of the Unreasonable Group, of the Unreasonable Institute and a number of other "Unreasonable" companies.

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  • In my personal opinion I think that starting something like a buisness with friends can definitely be more benefitial than starting one with a stranger simply because you have already gotten past that stage of having to “figure them out and know how to work with them”. On the other hand I would say that when you change a casual relationship to a proffesional one it can lead to all sorts of unseen problems even if you follow the steps listed above. You could learn some new annoying habits your friends have that you were not aware of before and in the end it could potentially end some friendships.

  • Thanks for this article!!! Starting a business with a friend would be good idea because you can share same interest into making lots of money. I agree with don’t live with them too long because you could be seeing them too much with see them everyday at work.

  • It is great to hear someone tell their own personal story about this matter. Often times you hear about how bad it is to work with family and friends. I agree I feel that it can be extremely important to work with friends because they are people you trust. When you start something new you are learning something new. It is nice to have a group of people who you know you can trust along the way. I feel these tips can be helpful in more ways then work. When it comes to anything in life you look to the people you trust the most to reassure you that you are doing the right thing. Thank you for sharing this great article.

  • I support the four points you talk about. Something to consider too I think is the origins of friendship. A lot of friends I made over the past few years have been through college and grad school, whose friendships grew out of an organic interest in the same professional objectives as me. In counter, I have friends from childhood who in many ways are my “best” friends, but going into business with them would be based off something other than professional objectives. These latter friends are ones I recognize would not be the ones I would go in business with, not because they’re not actually my friends, but because the friendship isn’t tied to a business.

  • Genius! As soon as you are having fun doing the thing that you are passionate about, big things will start happening.

  • I’m just wondering if this goes the same with family? With family you still have to see them if something goes wrong, with friends you can make new ones. I had a cousin who got family to invest in his business and he lost all the money, now things are really awkward at family functions.

  • I only work with friends. Trust is the bedrock of value creation. With accountability, values alignment and excellent communication, there is nothing a dedicated group of friends cannot achieve. Aptitude follows enthusiasm, not the other way around.

  • I have heard of the myth and never really agreed with it. I think for a business to really take off there needs to be a chemistry within the group. If there is no chemistry I feel like you can’t make much progress. I do understand that when push comes to shove if your friend isn’t doing his or her job it’s time to take a stand but I’ve always felt that friends are going to want to work for you not feel forced to. Thank you for sharing this insight!

  • i agree on the fact that friends are going to want to work for you rather than to feel forced to work with you.

  • that is a great question, however, i feel that family businesses are far more complex, as family business you can’t really fire or else there will be more problems are greater than if you fire a friend, family you can’t choose and friends you can but sometimes friends are more like family than family so its something tricky

  • I agree with this completely. I have never started or tried to start a business before but I have worked with my friends. I always accomplish way more work when I am doing anything with my friends. It is way more fun to work with your friends than with someone you do not even know or completely trust.

  • I agree with this article. sometimes we cannot do a business with best friends, becasue if company goes bankrupt, the result not only impact the relationship between you and your friends but also infulence the worth assigned, it is unworthy. I met some cases about best friends who work together with business, no one keep the best relationship at last. So, thanks for sharing this article for us and we realize how to do the business.

  • Thank you for sharing this article. I agree, I think the best people to do business with are your friends because they’re people that you trust and you already know that you get along well together. I also think that for it to work though, the 4 things listed above definitely need to be followed. Communication is key in any type of relationship and if it isn’t there then the relationship won’t work out. You mentioned this is what you’ve learned from trial and error, how are your relationships with these friends now?

  • I totally agree. My best friend and I did some volunteer work this past fall for a couple of weeks. We got more done when we were working together than when were were working apart. Working together made it more fun and since weren’t bored we were able to be very productive.

  • Thank your for sharing your ideas. Communication is the key element is every organization. Without
    it, the people cannot understand each other and share their ideas to build the
    organization. I love working with my friends or family because I could trust, rely
    on, and communicate with them better.

  • As a freelance photographer, I really appreciated these tips! I find myself working closely along with my friends. Do you have any additional tips for someone who might not direct these tips into a business perspective?

  • Thank you for posting this article. I found it helpful because if I do start a business someday in the future and I have friends being apart of the business. This can then really help because it will allow everything to run more smoothly. I do agree that communication is probably the biggest part in having a company run smoothly. With out constant communication and checking to make sure everyone is on the same page then it can cause confusion and lead to disaster.

  • Thank you for this post. Working with friends has always been difficult for me. It’s hard to find the line between having fun and actually being productive and getting things done. In the end we generally pull through but it isn’t always a very productive time. That being said it’s usually a group project or theatre endeavor and not an actual business. There are very few people, at this time in my life, that I actually think I would be able to start a business with. We often discuss starting a theatre company or an arts organization but it would be interesting to sit down and see what our motivations actually would be.

  • Very true, and sometimes when you are with someone so much, you start to act like each other and then all hell could break loose. A business with a friend would be great. Clearly if you are friends then you have similar ideas and interests, just making sure they are smart and responsible ideas and interests is key!

  • Thanks for the article. I think that working with friends can
    be a very good thing, or a very bad thing depending on the rules you set, and
    the respect that you have for one another. I think that with the right rules,
    and everyone has the exact same goal in mind going into business with your best
    friends can be a very good thing. I completely agree with the communication
    part, I think that communication is one of the most important aspect of any
    relationship especially in a business setting with everyone’s money involved. I
    feel that if communication is lacking then little issues can build up and
    created tension that could exploded at any minute, but if you had good
    communication and talked about those problems when they started there wouldn’t be
    any tension. One question I would ask the author is looking back was starting a
    company with your friends a good decision?

  • I believe working together with your friends is like night and day. It
    can be one of the greatest decisions you made in your life. Or you can
    lose friends due to the lack of motivation in your business venture
    together. It seems to me, there is a lot of give and take to make
    everything function properly. For example, everyone has that one friend
    who has the world’s greatest idea yet doesn’t possess the drive to
    execute these plans. Then there is that one friend that is hard working,
    puts in all the work but is not as open minded. You have to find some
    sort of balance and communication if you want things to work
    harmoniously. You want to ran a successful a business and not lose your
    friends. More people need to read this article, thank you!

  • This is a great post! Your four tips are helpful and to the point. I think working with friends has many more positives than negatives, if they follow these guidelines. These points can also help those interested in working with family. I think family can work, but may be more difficult. Would you say these four points work the same for family?

  • I absolutely see your point on having balance within the friendships and business. It’s like any relationship. If one person is doing more for the other person, then there will be animosity and tension. I also believe though, that business owners should think very hard if they should do it with friends though. I have friends that when I try to do work around them, I can’t because we talk way too much. So, it’s imperative to find people that will be able to work hard, yet, have fun with what you’re doing together.

  • Thanks for the post Daniel. I really enjoyed learning the ins-outs of partnerships explained in this blog. Little did i know that friendships are ruined everyday because of your vest of ownership idea. I thought how amazing is this idea protecting the friendship and also the company. How many times have you had a partner leave the company that you two so strategically planned out less than a year ago?

  • I agree with you on the more positives but as many say, the ones you least expect are the ones who steal from you. I think there always has to be a fine line between friendship and business partnership!

  • This is a fantastic post. First off the 4 different headings are perfect. Communication is such an important aspect of any business let alone relationships. I think that the “cliff” is a really clever idea and definitely a fair one. It leaves you without worry. Then moving to the third heading, you must have motivation in whatever line of work you fall in. It really helps you establish goals. I am curious as to what other suggestions you may have for dealing with being around the same business partner/friend for extended periods of time? Because sometimes it is necessary and you need to find ways to cope.

  • These were some really great tips. I do not ever plan on starting a business but even working with friends can strain a friendship. Everyone can relate to working with a friend or even becoming friends with someone at work. It can be hard at times especially when its a competitive job. I kind of disagree with the communication point just because it does not matter sometimes how great two people communicate if there personalities some how class at work it just won’t work.

  • I think this is a great article that brings to light the potential of long-term and thriving relationships with people you respect and trust. I think the strongest relationships are formed with people with whom you respect. Therefore the potential for long-term sustainable profits are possible. I think aligning motivation is critical in establishing a strong and grounded foundation, one common goal is necessary to establish direction.

  • Great article, Daniel. Doing best with real friends is a great way to have a trusting relationship. I also agree that living with a close friend isn’t always a good idea. I currently live with my best friend from high school and we certainly haven’t gotten a long the whole year and get a long better when we aren’t roommates or don’t see each other often. I have also found that working with a person you don’t know can help you gain supporters and a trusting relationship. Who has been your biggest influence/friend/co-worker in your life?

  • I’d also be interested to hear Daniel’s opinion on working with family members. I would assume family members would be more candid and brutally honest in the workplace, so would it maybe be a good idea to make even more specific guidelines?

  • Really great article with good advice. I think working with friends at work is great and it has some many positives or negatives. I think if you you are their friend and respect them than there should never need to be conflicts. If you have great friendship than the company should have little issues going in the right direction. Thanks for sharing

  • Great article and thanks for sharing! You gave some really good advice with working with a friend. With living with a close friend, it can be a good idea and a bad idea. A lot of people get annoyed with their roommate who is a close friend. You see all the little things that they do that you normally wouldn’t see if you didn’t live with them. It can be tough. One question I would ask is was it a good idea to start this business with your friends?

  • This is a really good question that I have been thinking about as well. I am not going into the business field and it would be nice to know how to work with friends in a different field. I can see myself working with friends in the future and it would make it more fun!

  • This was an interesting article. I see how working with friends can be extremely rewarding but I worry that it might be easier said than done. Business environments are always changing- we can never expect whats to come. In business you ultimately need to do what is best for the business and that might not align with what is best for the friendship. I very much agree that it is important to work with people who can make you laugh, who you trust, and who make you happy to come to work everyday, but I think you can and should make these connections at the workplace, rather than bringing your personal friends into it.

  • Caroline, I totally agree with what you have to say! It’s true that in business environments are always changing and that we can never expect what’s to come. While reading this article, it reminds me of the rule of not rooming with your best friend in college – and I think it plays out the same in the business field as well. However, it’s a different experience for different people. I still think it’s doable to have a business with your best friend. Communication and a mutual understanding is definitely key. Thank you so much for sharing!

  • I thought this this article had a lot of excellent advice, I’ve always thought that if I were going to launch a new start up I would want it to be with someone who I trust and know very well. Although, I’ve worried about problems with mixing work with friends and that ruining the relationship. With the advice that you’ve given in this article I think that mixing work and friends could be very successful from a friendship and partner aspect.

  • Thank you for this post! I definitely agree that going into business with friends isn’t a sure way to fail. I think if you prepare properly and make sure your motivations are in line, you can certainly make a friendship business work out. I think I’d be more inclined to work with someone I’m comfortable with because I’d be much more willing to throw off ideas that I may think a random person might throw aside. When was the first time you worked with a friend?

  • I am in the same boat when it comes to why I’d want to work with a friend. Trust. It seems strange that people would stray from working with people they knew on a personal level. I believe it could only have positive effects on your business and relationship if you plan and prepare the right way.

  • I definitely think it’s doable to have a business with your best friend, but you’re right when you must have a mutual understanding otherwise things could go awry quite quickly. As long as you plan and prepare for the worst, I think two friends could do a great job with a business. Did you ever room with your best friend in college?

  • I have never really seen someone advocate working with friends before but the thing that caught me off guard the most was the “don’t live together too long” portion. However after your article it makes complete sense. Great article and it was very interesting to read something I haven’t heard anything about from this point of view.

  • I definitely agree, Justin. I have not. My best friend and I from back home purposefully made sure that we don’t go to the same school so we never had the chance to room together. I’m not saying that rooming with your best friend is a bad idea. But for us, we know that we won’t be able to get along as well when we room together – we are way too different.

  • I definitely agree, Justin. I have not. My best friend and I from back home purposefully made sure that we don’t go to the same school so we never had the chance to room together. I’m not saying that rooming with your best friend is a bad idea. But for us, we know that we won’t be able to get along as well when we room together – we are way too different.

  • I think this thread sheds light on a core idea: the case for working with friends is completely situational. Maybe on could say Daniel is a rare breed who find meaning,life, and passion in his work (something everyone should ultimately strive for?), but that’s not the case for some. It takes a special relationship with a special friend, which is one of Denial’s points. Myth is debunked, but maybe it was always a generality made about business that is dependent on the person, the business, the values, etc…

  • I can relate to this because my parents own a business with my aunt and uncle and communication is the number one thing they “flaw”. They do not see many problems besides this and it seems like such an easy problem, but is a lot more complicated than most people think.

  • Thank you for sharing this article! This applies to lots of people as many have heard the saying about never doing business with friends. For example, I know that my aunts were in business together for a while and because of poor communication and differing motives, their relationship became unstable for a while. Daniel, what percentage of people would you say disagree with your perspective on this topic? I would guess a lot.

  • Thanks for sharing Daniel! This is some really great information for many young entrepreneurs. I have had many friends start business ventures together and the majority have failed so I have always been weary. That being said there are many friends I hope to do business with for the reasons you mentioned; we get along, we have similar values and most importantly I can trust them. I think this article really hits it on the head by planning for something other than the best case scenario and how to remain friends through these trying times. Thanks again!

  • As an aspiring entrepreneur, I can’t count how many times I’ve called a friend to tell them about a business idea and the thought of starting it together came up. I can really relate to this article simply because of the experiences I have had too. From group projects to event planning, doing so with my best friends can be the most fun and most frustrating times imaginable. Thank you for the advice! If I ever go down that path, I will be sure to keep these tips in mind.

  • I agree with this article. sometimes we cannot do a business with best friends, becasue if company goes bankrupt, the result not only impact the relationship between you and your friends but also infulence the worth assigned, it is unworthy. I met some cases about best friends who work together with business, no one keep the best relationship at last. So, thanks for sharing this article for us and we realize how to do the business.

  • I found your article to be very helpful. It is true, it is extremely important to work with a person who you completely trust, and who better than a person you can call a friend? Although I think that working with a friend could be a good idea, it could have its bad. Like you said, being around your friend almost everyday, or even living with them can cause conflict and that is why we do need to make sure we have some space once in a while. Thank you for sharing this article! I look forward to reading more.

  • I met Rand Fishkin, the founder of Moz, and he started his business originally with family. He ended up taking on massive amounts of credit card debt that eventually put him on the “blacklist” and he tried hiding the debt from his dad. Today he isn’t invited over to his family’s house for Christmas….Communcation is key when trying to maintain a healthy family/co-worker relationship. I don’t want daddy probs.

  • I wholeheartedly agree with the fact that it is possible to do business with friends. Friends want you to come away with the best outcome, as you do them. Win-win negotiations are possible!

  • This reminds me of another myth of never doing a group project with friends. I’ve experienced both good and bad but ultimately, I agree with this article that it is possible to work with friends. However, I don’t think that all friends can work together in a business. It depends on if both parties have the capability to form a working relationship besides the personal relationship. I believe it’s important to separate work from personal life. If a working relationship is able to be formed, then I think that forming a business with a friend can be extremely rewarding because you’re able to create something with someone you already trust!

    I really liked the formula you gave for doing business with friends. I agree with each step and think that it can be an effective method in helping a lot of business partnerships save friendships.

  • I think these are great points to make. Doing anything with a friend can always be tricky, because you don’t ever want to ruin a friendship. Just because you are best friends doesn’t mean you should do things such as live together, or start a business together. I think this advice can help with many things involving friends. For exmaple, you could use it for living with a friend. Communication is key in anything, you need to be on the same page. Having your motives in line is also a great point to make. you want to make sure you both have the same goals for your company. Thank you for sharing.

  • Thank you for this article. I have always considered working with friends for the same reasons you mentioned, “…people you trust, admire, enjoy being around.” If I was going to start a business with people who I will have to spend a lot of my time, trust them with money, and have to work with on a daily basis, these are qualities that I would look for. All your points on how to address the main obstacles of working with friends are excellent advise. I had been trying to figure out how to avoid the issues of equity ownership and I had never heard of the ‘Cliff’. I also appreciate the information on making sure your motivations are in sync. That could lead to significant conflict if one individual has more motivation towards profits while another person is more focused on social impact. This has been very helpful.

  • Thank you for sharing this article with us and I agree with it. Starting a business in it self can be very hard to begin with it. I feel if your going into a business you should find someone who has the same ideas a you and have the same work ethic you don’t want someone who says there going to do things, but actually never do and now you stuck with doing it. I do agree with you should work with people that make you laugh and who you can trust, and who make you happy going into work everyday. I think you make those connection when you go into work and it doesn’t have to be with your best friend. I feel like starting a business with a friend is a bad idea to begin with because if it doesn’t go well why would you want to wreck a life long friendship because you started a business with that person. Thank you again for sharing this article.

  • Thank you for sharing this! I previously convinced that working with friends was just the first step to ending a friendship. Now I understand that you need to listen, communicate, and try to be understanding….just like how every work relationship should be. I also think clashing personalities is another reason why so many friendships fail when there are disagreements within a specific business. If you and your friends are all alike and have exciting entrepreneurial ideas, that might be the recipe for one awesome business, so a bit of trial and error can only determine who you work best with.

  • I have had good experience working with friends. More often than not I prefer it. To me the critical part with working with friends is to be honest with each other. If you cant confront them with issues you have with their work or ideas than you shouldn’t be working with them. I don’t mean confront them in an aggressive way either but simply express your thoughts in a relaxed way. This article makes some great points! Have you had any issues with working with friends?

  • I have seem so many more horror stories about friends doing business than any that actually succeed. Even if a business does workout it still tends to take a toll on the relationship, you and that individual are not the same as you were before a business venture. I relate to the same kind of situation of living with friends I tried it and now i have no contact with those who i lived with in the past.

  • I have learned myself that trial and error is the best way for me to learn. Its hard to understand somebody else’s point of view, without fully experiencing it myself. I also enjoy your bullets on ways to help and make sure friendships can stay friendships through a start up. Of course, it would be awesome to begin a startup with a best friend who you are close too. You would be able to communicate like you said and do whats right for the company. However, on the other hand I can understand how that might quickly diminish within a short period of time. If a disagreement occurs there is potential to lose a friend and your business as well. Did you and your roommate stay friends throughout the start up, even though you were together for almost the whole day, 7 days a week?

  • I agree with you, I think it takes a lot to consider working with your best friends. It’s no longer fun and games when trying to start a company up. It could put someone in danger financially. It is a lot to consider. I think there is a difference between getting advice and actually working together.

  • I agree that it would tricky to work with friends some if the time and communication is a big one! I have friend and her family has a lot of money and she was wanting to open a business with me. But I do not like that factor because she will be mostly the owner of it. So I decided I wanted to open my own business because then it would be my business.

  • I agree and disagree. I know plenty of people who have done this or even dated there clients. It has worked out well for them. Its kinda like they have de-bunked the old saying “don’t shit where you eat”. I think it depends on the business and the person/people. Sometimes having amazing relationships and going into business can work wonders.

  • I think it also is a great idea to go into business with friends; but the right ones. These four detailed suggestions really put in perspective for an aspiring entrepreneur to choose who to work with. Personally my friends are everything to me and I always want to share things with them and accept their opinions and advice. If you are on the same page and have the same motivation to become something great you should be able to work out all problems faced. Thanks!!

  • These are great points of advice. I think what you said about communication is very important, in any relationship. Yes, in relationships you want to avoid the bickering or bringing up conversations that could put a wrench in your friendship, but in the long run this can be detrimental. Some things in life may be uncomfortable, but realizing their importance can be helpful. Like you said it may seem like more work to find a compromise, but I feel in the long run if you have similar goals this can work tremendously. Taking risks yet being smart about them can get you a long way.

  • I agree that working with friends can make working more interesting and relaxing, with that, there are still a lot of concerns that immediately need to be addressed when starting a business. Yes the author states that communication is important, but as friends they may have a “ill check that message later” attitude. Making sure that communication and making sure that criticism is welcomed are key to working with friends. I completely agree with Kristenwagner32 (comment below), working with friends is great, but the right ones.

  • I agree with the both of you very much, I do not think that I could do business with my friends. I would like to keep my work life and my social life separate honestly. It would like you said Amy take a lot to consider working with your best friend. I also agree with you that there is a difference when getting advice and actually working together. Thank you Daniel for sharing this article.

  • Thank you for sharing this article and your thoughts about working with your best friends! I was always taught to never go into business with family or friends but I have always been skeptical about that teaching. After reading this blog, I can now honestly say that I agree with you completely. When I was reading your 4 tips to do business with friends, I felt like I was reading the keys to getting married and what you have to do when your married! That’s exactly what businesses and start ups are! You need to be absolutely committed, have excellent communication, and you shouldn’t be around each other all the time. It always looks like an amazing opportunity at the beginning of it all, but if everything isn’t in line and your 4 points aren’t met, there will be disaster.

  • Great article and thanks for sharing. This would be the best tips that give to the people who want to startup a business with their best friend while remain a great and forever relationship. I have been told by many people that never doing a business with family or best friend that could put you on the hot spot. That’s true, but for some circumstances working with family and best friend is not that serious problem, if you can follow what you have read above. I appreciate what you shared and it is really into my mind to deal with those tricky issues. I am looking forward to read more about your article.

  • As a current student in business school, there’s no doubt that my friends and I have dreamed of starting our own business together. We couldn’t imagine a more brilliant, relaxing, and efficiently run company while in the back of my mind, knowing that it could very well end up as a disaster. But I whole heartedly can see the positives of starting a company or working with friends. Besides, what kind of work place would it be if your coworkers weren’t your pals? The most important action from this article is number 1, communication. Even outside of business friendships, communication is key for a smooth ride and even more so within a professional setting.

  • I fully agree with you Jessica. I have had the joy and the pain of working with two of my closest friends. Although all four points are important, the key to creating a strong bond was communication in my case. Even though we sold the business a couple years ago, I know my friend will have me in mind whenever a great opportunity arises. It was also the key to destroying one of my friendships too. The lack of communication will drive a wedge between friends and slowly push the two apart. Thank you Daniel for sharing this article

  • I definitely agree with this article. We should not do business with our best friends as if there is something that happens to the company, our relationships will be broken.Although sometimes it is a good thing that we can work together with our best friend as we can communicate better with our friends and we can trust them better. You are very lucky if you can work with your best friend as you have similar values and thought.

  • Great post! Even though working with your best friend may sound great on paper there are a lot of downsides by doing so like you mentioned. I would absolutely love to work with my best friend but unfortunately it would never work out. We may have some great ideas, and work well together but at the end of the day I think we both know that it would never work out. I tip my hat to all the people who have had success working with their best friend, very lucky people!

  • I have seen many people go “into business” together on something as simple as a class assignment and they end up getting on each others nerves. I think the most important thing that you mention in this article is making sure your motivations are in line. You want to make sure that the friends that your working with are as passionate about your cause as you are and aren’t just along for the ride. Sometimes you just shouldn’t mix personal and professional, that’s awesome that you guys made it work though! I feel like everyone should take notes from you guys haha!

  • I love this article; why shouldn’t we be able to mix friendship and business? Friends know us well and can help guide us to make the right business decisions. I do think it is crucial to have a good communication system set up- letting your friend in on bad news is never fun but it is crucial for a business to run smoothly. I found the rest of the article to be insightful as well- thanks for sharing!

  • I really agree with your post, Daniel, and your steps to ensuring it works is very helpful. However, I am witnessing first hand what happens when working with a friend goes wrong. Two people I know are currently at war over a business they started together. After realizing that they could not stand to work with each other one of the partners pulled out and is now suing the other. Not only has their relationship been ruined but they are brining others into the dispute by making people chose sides.

  • Daniel, thank you for this post and great advice; it definitely gets me thinking.

    I have a question for you: If I have a good friend who is not at all reliable, do I remove her from the name for my start-up business? She and I have had many discussions, but she is so unreliable and I have not proceeded with her very much because of this. Please advise.

  • I agree with you. Business and friendships should not be combined. When you work in a business, you are often forced to make tough choices and you need to learn to stand up for yourself. When you work with friends, it is easy to not want to play the “bad guy” and stand up for what you actually believe.

  • You bring up a good point with the group projects. I have had a lot of fun working on plenty of group projects with friends, along with that, I have had plenty of frustrations as well. Some times, it is a little difficult for me to speak up to friends, for fear of confrontation or upsetting them. This is something I have worked on though, and have been able to improve on, but it isn’t always easy. I can see myself feeling the same way though, when starting up a business. Although, running a business is a bigger investment than a group project, I still think I would be a little hesitant when confronting friends. It would be something to work on though!

  • Since I can remember, my parents have told me to never work with friends–but I think that in certain situations, a project can reach unique level of success when friends come together. There is (hopefully) a shared level of respect and trust that is rooted deeper than a business relationship. They hold a level of accountability towards one another, which can make friends/partners more divested in a project.

    Thank you for sharing such a great insight!

  • I agree with how you need to have good communication set up for your business to run smoothly! That is very important! Definitely the bad news as well. I feel as though you should never try to keep anything like that from your business partner as well as a friend

  • Yeah, if you were to work with a family member, they most likely know a lot about you already. And if a problem occurs, you can’t really turn to family to talk about it. But then again there are positives, seeing as you already know each other and you can get down to business. I would agree that there would need to be more specific guidelines.

  • I think this is a very respectable article because it brings to the forefront a topic that has always been pushed away in the past. Working with close friends does require slightly different tactics to ensure separation between work and outside life opportunities and challenges. I like the point you make about preparing for possible challenges in the future right from the get-go, not starting off assuming that no changes will ever occur. Life happens, and you need to come into a business partnership with friends or acquaintances not being naive about that fact. How do you view partnerships that involve relatives versus close friends?

  • I feel the same way. I think it is more important to learn how to be friends with people you may work with instead of choosing to work with people who are already your friends.

  • I think this idea of working with friends is a powerful one. I have always be told don’t work with friends or love with them because you will end up fighting and loosing a friendship. After reading this article I feel differently. I think it really can work despite what others believe. I think as long as you work out the tough decisions and communicate things can work. Have you ever worked with a friend?

  • Thank you for sharing this article. I thought your 4 strategies were on point, especially the first and last one. I believe communication is very important in everything you do. You just can’t expect everyone to know what you want every time! I also agreed with the last strategy because like you said in any relationship, it’s important to have a little space.

  • Thank you for sharing this article. I like your reasoning for doing business with friends. However, if one is too emotional, I feel that a friendship could be terminated pretty easily. I suppose I don’t know for sure, as I have never been a part of a business before. Have you ever had a friendship end because of your association with them in the work environment?

  • I agree that working with friends can work if you have some ground rules when you start, without ground rules i think a lot of problems could be caused by people making decisions and just thinking they don’t have to discuss it because there friends and everything will be alright. I think that it can be a good thing because you have known each other for a while and now how to communicate with each other and know how each other react to certain things. I think that if the friends respect each other and have good communication skills working with friends can be a very beneficial thing.

  • Yeah I’d say thorough guidelines would be beneficial. As long as they don’t become too much like rules, maybe. One positive of working with family members is the ability to be even more emotionally invested and open about your feelings and ideas, so specific guidelines might make the work environment unnecessarily hostile, I think.

  • These were some really great tips. I do not ever plan on starting a business but even working with friends can strain a friendship. Everyone can relate to working with a friend or even becoming friends with someone at work. It can be hard at times especially when its a competitive job. I kind of disagree with the communication point just because it does not matter sometimes how great two people communicate if there personalities some how class at work it just won’t work.

  • Thank you for the article. I completely agree with your ideas and advice. Always be careful when going in with friends. I especially liked the part of making sure priorities and directions of interest are aligned. Without that, the business would fall in on itself. Thank you again for the great advice.

  • Ryan, while reading this article I thought of my girlfriend and found that our personal relationship was a lot like the start-up idea. Living together is a big commitment, working together is even harder (especially with a loved one). Try to look at it from that approach, and I believe you will answer your question. Has a relationship of yours ever ended or been snagged due to an association with them in a work environment or living in close quarters?

  • This is a wonderful article. Being involved in a family business can have trials and tribulations as well, but being related can make it easier to forgive mistakes or differences in opinion. Families are at least biologically linked when something goes haywire; when hiccups emerge amidst partnerships based in friendships, there is not that last-ditch cushion of security. As expressed above, it is possible to go into business with friends successfully, but it takes very mindful planning and intelligent orchestration.

  • I would agree. A good guideline for me would be keep work at work. There is no need to bring work to family outings and such. Also the benefits would be great, you wouldn’t want to see your family fail, so emotionally you are completely invested.

  • What you initiated is very true. Although working with a really good friend, who you can trust may seem like a good idea, it really isn’t in the long run. When things aren’t going well in the workplace, there is a good chance that you might take it out on the friend that you are working with. A friend is someone who you can talk to about your frustrations at work, but if they are the cause of the frustrations, then who do you go to? Not only can working with a good friend cause problems, but it could possibly end a friendship.

  • I agree with you business and friends don’t match up. Your risking a friendship. Keep business “business” and friends “friends.

  • That is honestly so true about not doing business with best friends. It’s kind of like how a lot of parents tell their children not to room with their best friends when going to college because you’re going to end up hating them. Doing business with friends I just feel never ends good. I feel that one would have a difficult time actually telling their friend how they feel about their performance as an employee and hold a lot back. What a great article!

  • I would agree with Justin here. You simply need to be on the same page. Mutual understanding is key. Preparing for the worst is crucial too because you don’t want to be left with an unsuccessful business or a lost friendship.

  • It’s hard enough living with your best friends, but working with them would be impossible. You see people differently as roommates and business partners. Friendships are extremely valuable and when something goes wrong, it’s hard to see that person in a different light. I have successfully lived with some of my best friends, but I’ve also lost friends because of it as well. I couldn’t imagine doing business with some of my friends. Thank you for this post!

  • I agree and disagree, only because it’s really tough to have that mutual understanding. People can say they understand, but that may be simply to please the other person. If this is the case, which in my life it has been, things spiral almost immediately. It’s tough to put full trust in people, that’s for sure!

  • In my experience, my work friends are much different than my other friends. Many of my friends at work I do talk to while on the job, but I wouldn’t regularly hangout with them or go out drinking. Work is just a totally different experience than school or sports or just normal life. You see people in a different light at work.

  • I agree with you, but I also think that ground rules are really tough to establish. Both people must have 100% trust in that other person and not sugar coat anything while establishing the beginning parts of the business. If one person is on a different page than the other, things can go awry very quickly!

  • Work and personal life are two totally different things. For me, my work friends are friends I can hangout with at work, but I don’t see myself going out with them on a Friday night. You see people in a different light in a work atmosphere, and I think that’s where many of the problems with friend based businesses start.

  • I totally agree with you! Communication is key, whether it be at work, in a relationship, on a sports team, or at school. Peacefully resolving conflicts can be very difficult, but it’s also a crucial part in starting and maintaining relationships.

  • I agree with you completely, but unfortunately lots of people just don’t want to put in the extra effort it takes to save a relationship. It’s true, “you don’t know what you have until it’s gone.” It really is a shame when people stop being friends over one argument or a fight at work.

  • Thanks for sharing! I really like all your points. I honestly don’t think I could go into business with one of my friends.Like you stated in the third point, I just think I’m one of the more motivated people in my group of friends and I think I would always be the one working the hardest and caring the most which wouldn’t be good in a 50/50 partnership. Also I like to challenge myself so I would probably try and build a start up on my own.

  • I agree with you. Just working with friends can be difficult for numerous reasons. There’s always side tracking going on when you are that comfortable with someone.However, sometimes it may be better than working with a stranger for the sole reason of comfort level. A lot of times random people who work together communicate very poorly and may not get the job done as well.

  • You picked the same two points that really stood out to me as well. I really like the first one because without solid communication you’re going to fall apart no matter what. Also, I like the last one because space is critical in everything that two people partake in. Especially as business partners.

  • I agree with you. If you can successfully resolve a conflict you can only grow from it and learn from it. There are going to be problems in all kinds of relationships, but if you can work through them together you’ll be better off.

  • Thank you for sharing your example Collin. Fortunately, I’ve never been in the same working environment with a significant other. However, I have worked with my best friend since I can remember, and to be honest, there were a lot of issues that came between us. Maybe it’s a result of us two being really competitive as friends; I’m not exactly sure. But individually, I just couldn’t see myself ever working with or for somebody close to me for an extended period of time.

  • I’ve seen friends who have done business with each other and yes it starts well, but it very difficult to maintain that working relationship and friendship. There are days were they obviously have a disagreement at work, and although its nothing personal, it still drags through to the friendship and definitely puts a hardship on it. But like you said in your reflection, they have both said they wouldn’t have it any different. The friendship was a solid foundation they built their business on, and they both agreed that if they did this with someone they didn’t necessarily know, they would nowhere near have had the success that they have had thus far.

  • That is weird how being at a work place changes so much personality wise. That would be a cool study to understand why and how much changes. I have a good guess why it changes though. Mostly because you trying to prove your self as an employe and you do not want to goof around and get in trouble.

  • Daniel, bravo on another well written article. Doing business with best friends is a terrible idea. It’s kind of like sharing a room with your best friend in college. It’s too risky because there’s so much tension between roommates and you never want to ruin a friendship over living arrangements.

  • This is what i also believe and the reason why I think you have friends
    and business friends. If you make fiends in the business world i
    believe they will be business first and friends second. Does anyone else think this?

  • This is an inspiring article! I agree that while working with your good friends or best friends it will be a lot of work to make sure that both your business relationship and your personal relationship are both healthy and prosperous. I don’t think many people consider talking about things like tensions, concerns, problems, and other things that cause confrontation but they are just as important to talk about as the good things.

  • I think that this article was an insightful read. With graduation coming up, and being a business student, I have often thought about starting my own business now or soon in the future. There are many pros to having friends be your business partners and yet I am also hesitant due to many of the things mentioned in the article (the saying “never do business with friends,” confrontation, etc). It was great to get some tips and read about another’s experience mixing friends with business.

  • I completely disagree with the premise of “keeping business ‘business’ and friends ‘friends'”, as stated by commenters below. And I certainly don’t think that Daniel Epstein believes that either from what was stated in the article. The best friends make you feel more accountable than anything! And I know that if I were to work with my best friends we would all be accountable to each other to get the work done, and do it well. That said, I understand the potential for problems; however, if you take a proactive approach, and communicate honestly and act authentically from the very beginning, the predictable problems become a whole lot less likely of happening at all!

  • Thanks for this article Daniel! Really like the vesting with a cliff structure and will be sure to remember that, as well as clear communication, synergy in motivations, and taking time for yourself.

  • My boyfriend is constantly thinking up creations. He always seems to want to drag me into these ideas by highlighting the attributes that I could bring to the situation. He usually gets excited about something for a week and then it fizzles out when he realizes that he is a new accountant and has no time. I have now begun just listening but not really offering my opinions any longer. I don’t think that our communication is strong enough to be able to support a constant stressor like that. This has opened my mind to considering down the road.

  • I agree with this article with the fact that sometimes it is hard to do business with friends because if something goes wrong, it can put a damper on a friendship whereas if you dont know one of your coworkers, there isnt much lost. I also agree that you shouldnt live together for too long. I have some friends that lived together for a couple of years and their values and beliefs starting to clash resulting in them not being as close as they once were. i will keep these steps in mind the next time i do business with a friend.

  • This is a great article. Doing with your friends is a great idea, but I think it all differs from person to person. For some it could be great, and for others, not so great. It all depends on your relationship and how you handle problems together. The same thing can be related to non-business situations. For example, many people tell best friends not to room with each other in college because it may strain the relationship. For some it does end up ruining friendships, but for others it only strengthens their relationship.

  • This article gives a new spin on working with your friends. I have never heard of this side of the story and it is very intriguing. I think that all of these points make perfect sence however. You really need to work hard when you start a business no matter who is in it with you. The bottom line is that you need to keep great communication skills all the time. Thank you for writing this article and opening my eyes to other possibilities.

  • I always believed that as well. You have to be careful when going in with friends because I don’t think it is a good idea. Because I believe that it is very difficult to have two persons priorities and interests aligned. Thanks for the post!

  • Thanks! Before I read the article I would never tell people to do business with their friends. The article does very well stating that having a good relationship with your friends/partner is key. If I have a great idea and I already have a great relationship with someone, it would be awesome to go into business with them. I think a lot more entrepreneurs should read this.

  • I tend to agree. While I do think that you can accomplish both simultaneously, it is hard. Business is where people earn their living, sometimes it really cannot be personal. If friends are in the mix, then it becomes personal.

  • The saying “never mix business with pleasure” comes into mind when I read this article. I could understand why an entrepreneur or business mind wouldnt want to expose their business to a friend. A person may not always have the best intentions for the business. Then again it is only right to be motivated by a friend. It is important to have a deep understanding with them as well on how your business operates. How would one go by doing that? Thank you.

  • I completely agree that communication is so important no matter what type of group you are a part of. I think it’s fantastic that you are so intentional about talking with your partners and teammates on a regular basis. It’s so important to be able to talk about the good and the bad in a trusted environment. And what better people to have around you then your friends? I think some people believe that if they don’t bring it up, then maybe it will go away magically or believe that it doesn’t exist at all. I think all places of business should adopt your routine of communication.

  • I found this article very interesting. I too, have always heard “do not mix business and pleasure” which included working with friends and loved ones. As many times as I heard this, I have never experienced a bad experience working with my friends. Although I am still young, and do not have a career, the jobs that I have worked have been with my friends and they have went great for me. When I think about it, the best jobs that I did have were the ones that I did with my friends. But I do totally agree with the fact that you do have to have space. Working with my friends was fun, but I can agree that we did have to give eachother a little more space because we saw each other so often. But working with friends can work, and I think that you have really shown that. It was nice reading an article that supported that idea because you usually hear so much negative about it. Thanks! What advice would you tell friends that work together that are actually having problems?

  • Thanks for the article and I agree with it for the most part. I am going to compare it to the other old adage that says you shouldn’t room with your best friends because living with someone can ruin a relationship(which you also touched on). I don’t think that this is necessarily true however, if they are genuinely your good friend then you should be open and up front with them, much like your first point you made in communication. I’ve lived with my best friends for three years so far in college and have not run into any trouble at all, not a single fight. I think it’s the same for business and you can make anything work if you are genuine friends, not just mere acquaintances.

  • Communication is key in all aspects of life. Without communication we don’t grow as individuals. Although resolving problems can be difficult, it’s a huge part of life and it’s a skill that can take you far. If you are good at resolving conflicts, people are more likely to want to work with you rather than someone who isn’t good at solving problems.

  • I am a firm believer of starting a business with a friend. The closer you are, the better. There is more trust, respect, commitment, and communication. Without those, no partnership can actually flourish. The part about vesting your ownership and adding in the “cliff” clause was most intriguing to me. I had never thought to put that in to the conditions. I really wish I would have known this when I started my FAILED business with my brother, who decided that after 5 months of slow moving success that the company wasn’t going fast enough and he needed to seek fast, secure income elsewhere……Brothers I tell ya.

  • I have always felt that business should never be mixed with friends. I have always thought that mixing the two could potentially lead to failure and possibly ruin a relationship. My family owns a lot of rental properties (basically like a business), my mom decided to rent one of the properties to her friends and everyone told her not to. Her friend ended up being the best renter we had ever had, she always paid on time and kept it professional when needed.

    Viewing that experience opened my eyes to possibly doing business with a friend in the future. You already know what type of person they are as well as all their strengths and weaknesses. I think both parties just need to understand when things need to be professional. I really enjoyed this article, it gives a whole new outlook on doing business with friends and what a myth it can be.

  • I really enjoyed this post. What he says about going into business with friends is true. It can be hard but as long as you stay honest with each other it makes the experience that much more exciting.

  • If doing business with friends is bad, then how to choose the business partner which you can trust? We can trust friends but not some random guy. How is this solved?

  • i think it is always tricky to do business with friends because if it doesnt end up working out, you might lose your business and one of your friends which might be more than a business. this is also true about not rooming with your best friend because you will grow to not like them any more. good article.

  • I am a bit unsure of how I stand on this notion of “friends in business”.
    On the one hand, it is true that your actual friends are those that you trust and want to invest yourself into the relationship. It makes sense than to do it in the realms of business endeavors, where your buddy is one that you enjoy spending time with.
    On the other hand, I think that personal feelings would become too much involved. Your friends know you well (on a very personal level I might add) and know your experiences, who you are and what got you to this point in your life. The problem I see coming forth is that since they know all these things, instead of getting to know you for your vision now in this fresh start is that they could use that as a negative tool. You debunked this in point #1, but friends can be sensitive and maybe we won’t want to be overly honest-and in turn make a mistake that could terminate the business.
    I guess the main need then is to make sure that the friends you want to join with are what you think of the best people you can find, that you’ve seen be successful in other endeavors, and care more about a project then what it can give them in return.

  • That is a perfect example of this. I can see this in 2 of my close friends who were best friends in high school and roomed together in college and now are even closer. It all depends on how the 2 people handle the situations. I know I am currently rooming with 2 of my best friends and 1 of them seems to not be happy with the situation. My other roommate and I both have tried to work to get on the same wavelength as him but he just doesn’t seem very motivated to do so. It all just depends on how people react and I really do enjoy how this article works on how to successfully work with friends.

  • I think that the most important point to this is communication. I think that as a society this is our major downfall, it is so important that we make sure all of our intentions are known and out there.

  • I agree with you 100%. Every start up is going to have it’s downfalls no matter. working with people whom you trust is a great plan as long as everyone is down to do their share, willing to communicate, and be honest.

  • I really like the tips given in this article. I would love to go into business with my friends and I think these tips could be of huge help.

  • I agree completely. Working with friends can also be beneficial because you have history, you know how one another works and can work off of each other.

  • I agree with this but I also don’t think it means you can’t go into business with someone you have already been friends with before business.

  • always make sure when in a team environment the end goal is consistent and the motivation lines up. If everyone has a different end sight in mind, it will be impossible to reach one of them because we will all be tugging in different directions. It may be hard to do business with friends, but remove the personal relationship when in a business setting and have respect for each other. You have to be able to seperate the two and if you can’t it’ll be hard for you down the road in business. I’ve met great friends through business and I never tell them “no we can’t become best friends because we do business together” and in turn I wouldn’t say “we can’t do business together because we are best friends.” When I put it like that the first one seems silly to even think about!

  • It depends on the type of friendship you have with that person I feel. If you respect that person enough to separate the two you’ll do fine. Treat them like anyone else in the workplace and I don’t see issues arising!

  • I personally agree with this article. Going into a business with my friends is something I am very interested in. Knowing how they think and what their motivators are will help us be successful. Also I would know that if we were to get into a debate, we could see past it because of the friendship that we already have. I like that you said not to live together though. Living with each other while working 18 hour days would not be good. You need a break from those people you spend so much time working with to regroup your thoughts and have some alone time. Thanks for sharing!

  • this is great! thank you for sharing! all of these are so important when going into business with friends

  • I like this article a lot. I think everyone has or at least knows someone who has had the troubles of working with a fiend. It sounds like it will be fine until it happens and it turns out to be awful. I personally think it can work but it depends on the friend, and I think you should know your friend well enough to know if you will work our in a work setting.

  • Yes, totally, if something happens with the business, there is potential in ruining a friendship. No business is worth the value of a true friend. It is wise to keep the two separate.

  • “Communicate, communicate, communicate” is advice that all business leaders should follow – private sector, public sector, startup, or Fortune 500. It’s amazing to me that communication remains one of the greatest challenges for leaders across myriad businesses. Colleagues, regardless of position or role, benefit from good information flow and yet many leaders guard information in a way that limits innovation and cohesiveness. I also prioritize one-on-one meetings with my direct reports and schedule weekly team meetings. Love the ideas of monthly “48-hr work sessions” and quarterly “retreats.” Will have to do some creative thinking about those suggestions given my public sector orientation.

  • First off, thank you very much Daniel for this great article. This really resonated with me. I am currently in-between two of my friends who both want me to join their new start-ups. I am pretty torn and not sure on how to proceed. My current method of coping has been trying to avoid the situation so I have been ignoring texts and calls from my buds and it makes me feel awful/tears at my friendships with these great people. So I will definitely utilize your advice and communicate with them about my true intentions. Also, I love the idea of the cliff ownership. That is the main problem I have with one of my options. He has already worked a couple years on the company and it is still very small. I would obviously like to be given some equity but clearly I have not earned any ownership yet. I love the strategy of waiting and seeing if I am still around 1 year, 2 years, etc. down the road and receiving more of what I have contributed. I hope life is treating you well. I appreciate the help this article gave me. Please continue to post more articles, they really do help people. If you had some time, I would love to hear your thoughts on if you were in a similar situation to the one I am in, how did you decide between different options. I know there are a lot of variables in the question but I am just looking for a guideline on how to best make the decision. Especially how to kindly let down one of my friends who I will not be working with. I value both of their friendships and hope to be great friends for many years. I look forward to a response and thank you for all your help.

  • I strongly agree with all of the points made in
    this article. I have aspirations of starting a company with my friends and
    since most of my friends have all recently graduated and working the dream
    seems to be more tangible. My issue would be figuring out which friends to work
    with. I really like the idea of doing
    weekly 1 on 1 call, weekly tactical meetings but the monthly 48-hour work
    sessions is probably the coolest of them all. I feel like those 48-hour sessions have a
    major impact and are something I plan to one-day implement. Also like the idea of the one-year cliff when
    determining ownership, definitely the most vague part of this article and it is
    something that is a lot more complicated the farther you dig into the details.
    Overall, definitely a concept to consider before getting to far into the
    project. Having goals that are inline is probably the most important part of
    doing business with friends in my opinion. Some may be on the search for
    something to build and sell, others something they would like to build and hold
    on to. Some with different short and long-term
    goals. I think its important to discuss motivations and intentions at the
    earliest possible time before the friendship gets ruined, this also goes hand
    in hand with communication and transparency. I also really like the idea of
    living together in the early stages of starting a new business and am happy I read
    the article because I am not sure I would have thought about an exit strategy
    on the living situation. Having some alone
    time and space is important for all relationships, especially when you spend up
    to 18 hours a day with them. Overall, great article. Has reassured me that
    doing business with friends can work as long as the ground works are properly
    laid out.

  • Daniel, thank you for this affirmative post. While I have yet to graduate college – as I am a final year Computer Engineering student at the University of Florida – I have dabbled in various internet technology affairs, and the financial success I have found thus far has been from working with people I consider my good friends. Your article reverberates a truth I have myself discovered when collaborating with my partners in various internet endeavors, and I am glad that more than just I have had a positive experience in working with people that would normally only accompany us on a late night bar run.

    Interestingly enough, I came to naturally enforce each of the four rules you introduced in your article. By trial and error, I’ve discovered that too much communication is better than too little and being clear on every work task/objective is a must if we want our joint venture to succeed. Percent ownership is always a moot topic… After going through the motions of delegating ownership and leadership in a few (admittedly small) ventures I have learned it’s best to be upfront about your desired responsibilities and ambitions for the company. With these things clear, it becomes apparent who is more passionate about the venture (e.g. who is willing to put in time), who is more skilled in making its vision come true (e.g. who will actually put in time), and thus how control of the venture should be distributed (because the most involved should have the most control, at least in my opinion). I have yet to try your one year “cliff” approach but I really like the idea; specifically, I like how it values long term commitment to the vision versus a bandwagon approach in hopping from one startup to the next in order to acquire a mound of ownership in various entities (though I’m not sure how one’s reputation and future employment opportunities would fare after hopping around as described).

    There is likely less causation here than correlation, but every prospective business partner I have lived with has remained just that – prospective. I’m not sure if because my roommate selection is that poor or if the bridge between my work and personal life is just too drastic (in terms of time commitment and work ethic), but I have yet to live with any of my business partners. All of my partners thus far (whether in small to mid-size businesses) were my friends beforehand or became so soon after, but I have yet to live with any of them. I believe living with a partner early in the process would provide insight as to what they think of the vision (their perspective on the company’s possibilities) and what they do with those thoughts (how hard they work, whether they share ideas for growth, etc.). Luckily, I have been able to gain this insight by just spending a lot of time with my partners outside of work!

    Again, thank you for this wonderful article. I will continue to enforce these beneficial policies and hope that one day you may incidentally see the results of mine and my partners’ actions. I have bookmarked this article for later reaffirmation when the work-with-friends naysayers come back around. I wish you the best in all of your future endeavors, especially your Unreasonable line of co’s.

  • I find this article very interesting. I have always heard not to do business with those whom you are close with simply because of the risk involved. However, Daniels four points of view on the subject introduced a new angle. It makes complete sense that doing business with those that you trust and are comfortable can lead to great success. The points he made about how to maintain a healthy friendship and partnership are ones that I hopefully can eventually apply to my business. Thanks for sharing a different point of view!

  • This was a fun article to read because it reminded me of my father. Being president and CEO of his own company, he was able to chose his partners and those partners were some of his fraternity brothers in college. It’s important to run a company with people you know you can trust and work hard with.

  • Business is business, nothing personal? Well, I completely agree with Daniel Epstein, I think best businesses are made between friends. And that is just what Dr. Carlos Llano, founder of IPADE Business School in Mexico said “Rationality can not be the core of the company because the person, wich is in fact the essential part, is not pure reason”, and when there is no friendship between the workmates, work and human relations turns out to be only rational transactions between people. Nobody wants to work in a place where everybody is just a number. Friendship is the solution for today´s companies, that is why they are called “companies”.