Partnerships and Collaborations: The Art of Getting It Right
Collaborating can feel like a dream come true. You’re pooling talents, chasing ambitious goals, and maybe even creating something that changes the game. But here’s the catch: unclear roles and undefined rights can turn that dream into a nightmare faster than you can say, “Wait, who owns this?”
So, Who Owns What, Anyway?
Let’s start with the elephant in the room: ownership. You’ve got two (or more) people pouring their heart and soul into something—a novel, a song, a digital experience in the metaverse—and suddenly it’s done. But what happens when one person assumes it’s theirs and the other says, “Actually, no, it’s ours”?
That’s why defining ownership rights for jointly created works isn’t just a good idea; it’s essential. Spell it out early: who owns what, and in what proportion? If you’re co-writing a book, does one person own 60% because they wrote more chapters, or is it a straight 50-50 split? For digital creators, the question gets even trickier—does the person designing the codebase have more rights than the one providing the artistic vision? If you don’t clarify these things up front, you’re just setting yourself up for conflict later.
Quick Tip: Write it all down. I know, contracts can feel like creativity killers, but trust me—nothing kills creativity faster than a lawsuit.
Decision-Making: The Final Word
Okay, so now you’ve hashed out who owns what. But here’s the next potential landmine: decision-making authority. Who calls the shots if there’s a disagreement? Is it the person with the most experience, the one investing the most money, or the one who just shouts the loudest? (Hint: it shouldn’t be the last one.)
Establishing clear rules about decision-making can save you from heated arguments and bruised egos. Maybe you decide that each partner has veto power over major creative changes, or perhaps you agree to vote on big decisions. Whatever the process, make sure everyone understands it—and agrees to it—before you hit any roadblocks.
Let’s Talk Money (Because You Have To)
Ah, profit-sharing. It’s not the most romantic topic, but it’s one of the most important. When money starts coming in, emotions run high. Is it a 50-50 split? Do profits get divided based on the percentage of work each partner contributed? What about future earnings from royalties or licensing?
Here’s the thing: even if you think you trust your partner(s) completely, financial arrangements should always—always—be documented. It’s not about mistrust; it’s about protecting everyone involved. Plus, you never know how life might change. One of you might need to sell your share, or one partner might contribute less over time due to other commitments. These are realities that are much easier to deal with when you’ve got everything in writing.
What If It All Falls Apart?
Nobody likes to think about the end when they’re just starting out. But let’s be real—partnerships don’t always last forever. Maybe one of you decides to pursue a different project, or maybe you realize your creative visions just don’t align anymore. What happens then?
And one more thing: I’m not really a fan of partnerships. Why? Liability. What one general partner does—sometimes even without the other partner’s permission—can legally bind the other partner to obligations or liabilities they didn’t agree to. That means you could find yourself on the hook for debts, contracts, or even lawsuits because of something your partner did. It’s a risk I wouldn’t wish on anyone.
My preferred and recommended way for two or more people to do business together is by using a corporation or a limited liability company (LLC). These structures can offer legal protections that partnerships simply don’t. A corporation or LLC creates a separate legal entity, which means your personal assets are typically shielded from business liabilities. Plus, they make it easier to formalize roles, ownership shares, and decision-making processes in a way that minimizes risk.
The final choice—corporation or LLC—really depends on your specific needs, the type of creator you are, your location, and your future plans. Are you planning to grow into a larger venture with shareholders? A corporation might be your best bet. Want something simpler with fewer administrative burdens? An LLC could be the way to go. The point is, having a legal structure in place gives you flexibility and security, which is worth its weight in gold when the unexpected happens.
Regardless of how you decide to do business with one or more other people, planning for an exit strategy might feel like you’re anticipating failure, but it’s actually the opposite. Whether you stick with a partnership or opt for a more formal structure, outlining what happens if someone wants to leave is a must. Can they sell their share? Does the other partner have first refusal rights? What happens to the work you’ve already created together? Answering these questions upfront can save you a lot of heartache—and legal headaches—down the road.
Resolving Disputes Before They Happen
Here’s a scenario for you: you and your partner disagree about the direction of your project. You both dig in your heels, and suddenly the whole thing comes to a screeching halt. Sound familiar?
Disputes are inevitable, but they don’t have to derail your work. The key is to address how conflicts will be resolved before they happen. Will you bring in a mediator? Agree to arbitration? Flip a coin? (Okay, maybe not that last one.) Having a plan in place ensures that disagreements don’t spiral out of control, leaving your partnership in shambles.
But What About Trust?
You might be thinking, “All this planning sounds a bit… cold. Shouldn’t partnerships be based on trust?” And you’re right—trust is the foundation of any good collaboration. But trust alone isn’t enough. Think of these agreements not as signs of mistrust, but as safety nets. They protect not just you, but also your partner and the project itself.
And here’s the thing about trust: it’s fragile. It’s easy to trust someone when things are going well. The real test is whether that trust holds up when challenges arise. Having clear agreements in place helps keep the focus on the work, not the drama.
Wrapping It All Up
Partnerships and collaborations can be incredibly rewarding, but they’re also complex. By defining roles, clarifying ownership, planning for disputes, and laying out financial arrangements, you can set yourself—and your partner(s)—up for success. It’s not about expecting problems; it’s about being prepared for them.
At the end of the day (yeah, I said it), the goal is to create something amazing together. And when you’ve got all the legal stuff sorted out, you’re free to focus on what really matters: the work. Because isn’t that why you teamed up in the first place?
Mitch Jackson | links