Going into business with your spouse

| Aug 4, 2020 | Business Formation |

You love your spouse — and you share everything together. It only seems natural, then, to share your entrepreneurial dreams with them as well. Right?

Maybe. A couple can be great together in love and still not be a good match when it comes to operating a business together. While the “mom and pop” business model of the past is often idealized, going into business with your spouse in today’s world can be a little bit rough. Here are some things you can do to make it easier:

Make sure your spouse is right for the job

If your spouse has no background in accounting, don’t arbitrarily put them in charge of the books just because you want to make room for them in your new business. Similarly, don’t try to relegate a spouse who has a background in marketing to the back office while you hold the reins of the business. Either way, it’s bound to breed resentment.

Establish boundaries and roles

When you’re in business together, the boundary lines between your work life and your home life can get blurred. You need to establish some rules about how you’ll operate. Each of you should have your own separate space and some privacy — even if you’re only working out of the garage. You also need to clearly define who handles what part of the business. Learning to stay out of each other’s way and trust the other person to get their job done is essential.

Have an exit plan

What if things don’t work out? You need to know who owns what part of the business and who is responsible for the business debts. You may need to have a few tough conversations about the potential of a divorce later on. Considering a prenup that will outline what happens if you do end up divorcing isn’t a bad idea — and it could save what you’ve built in the future.

If you’re bringing your spouse into your business, it may be wise to set up a formal business structure that can help meet both your needs. Doing so may be the best protection against future problems.