Editor’s Note: Welcome to the companion article to Episode 19 of the MHP_IRL podcast! The purpose of this article is to expand your podcast listening experience with additional content. Companion articles will unpack larger concepts that we talk about during each episode that will give you practical and most importantly, actionable advice that you can apply to your MHP investing journey.
How do you find a good business partner?
If you know me, you know that I am SO SO thankful for my business partnership with Ian Tudor. For us, it was dumb luck. Ian and I grew up together in the same neighborhood as children.
But, from our conversations, I think we both agree that finding a good business partner is exactly like dating.
First, there is no blueprint. There isn’t a step-by-step process that you can follow to find the perfect person.
Second, there isn’t a time limit. Like dating, you don’t want to rush into anything serious. You have to get to know someone first.
As Ian puts it, “There are seven billion people on this planet. Give yourself the best shot to make that happen. Take actions and steps to put yourself in front of people who you think would want to be business partners with you. Think about what your strengths are, what you're lacking, and what you are looking for.”
In this article, Ian and I break down some key points as to why we think our partnership works so well.
#1. Two is greater than one is greater than three…depending on your preferences.
For those who work out, I’m sure that you agree, there is a difference between when you’re working out alone versus when you’re working out with one other person versus when you’re working out with two people.
When you work out with one other person, there's social pressure. You have to do one more rep. You have to go a little bit harder. Why? Because you have that person there to help keep you accountable.
But...when you add another partner to the group, working out becomes a social event instead of an actual workout. You get the other two people talking while you’re doing your set and instead of pushing you to do one more rep, they’re sitting on the sidelines joshing each other.
One thing that Ian and I realized was that we were working harder without really even knowing we were doing it because we didn’t want to let the other person down. That’s why having a 50/50 business partner can help you push through the lazy times because you have someone who is there to keep you motivated.
“I’ve always been someone who has always accomplished more when I’m working with someone,” said Ian. “It’s something I learned in the 20s, just being aware of when I got the most work done. Ryan and I have similar ideas of where we want to take this business and we speak quite frequently on the phone and it allows me to share ideas, which is really important for me, and it helps me to know that we are doing the right things.”
In business, you are the easiest person to fool yourself. - Richard Fineman
“Knowing this is extremely important, especially in business. When you’re taking in information to have someone to counterbalance your thought process, as well as your work ethic, it is helpful.”
#2: Learn how to disagree well.
If you ask my wife why we get along so well, she’ll tell you that we learned to disagree with each other well. Even if you don’t see eye to eye, you want to make sure that we don’t take it personally. We act and speak normally. It’s how we get through really tough disagreements with civility and humility. We respect and acknowledge how the other person is feeling. It helps us move forward without developing contempt.
And, Ian and I do the same.
“The people who know us know that I am the hot head in this partnership and Ryan is extraordinarily skilled at taking heat very well,” Ian said. “For me, allowing me to express myself in the most authentic way possible is extremely important for me to be vulnerable and authentic with the way that I am wired. That has allowed me to express my feelings and Ryan never takes it personally and he will find ways to get to the root of what I am actually trying to get at. That has been extremely helpful and I try to do the same when he’s expressing a heightened emotion that I may not be feeling.”
Ian went on to say that, “It’s really about understanding that we’re both going through the same mission, the same goal, and we are doing this to achieve our greatest dream and it’s not to tear the other person down, but building towards something and sometimes we’re human and our emotions come forward ahead of logic and we’re willing to forgive each other over that regardless of how that situation takes place.”
#3: It’s okay to bring comedy into a business partnership.
Ian and I make fun of each other a lot. We make fun of ourselves, and we make fun of others.
For me, one big way that I cope with stress and get through difficult conversations is through comedy.
It’s hard to be vulnerable with someone and have the trust to sort through emotions. A bit of comedy helps bring down the situation so that you can hold yourself rational.
#4: Your incentives must align.
Get yourself a business partner that has the same goal in mind. Ian and I have a mutual goal that transcends just operating a mobile home park. It’s a great social goal. We want to effect positive change with what we’re doing through education and financial well-being. That mutual goal gets us through the hard days.
When asked, what are some other ways that we keep our incentives aligned, Ian had this to say, “Number one, have a 50/50 ownership of the business. No one owns more than the other. No decisions are trumped. We will stalemate each other if we don’t come to some sort of agreement. Secondly, have an idea of how you want to grow. There are a lot of ways to grow in this business and for us we both agree that a slower, more sustainable strategy makes more sense. There is no incentive to purchase something that would put us in a financial situation that could be detrimental, especially because we are young and use recourse debt.”
#5: Acknowledge that emotion can overpower logic.
This is something that is very uncomfortable to think about. We all want to think that we are these stoic creatures with no emotions when it comes to business. That is just not true.
For example, Ian and I bought a property that I thought had the potential to be a huge operational time suck and I was thankfully very wrong. In retrospect, I can laugh about it.
I’m very thankful that Ian helped me keep my grounding. I was doing the analysis paralysis thing, and he was like, “Dude, relax. If it gets out of control, we are the team that can put a bunch of time into this and get it right.”
I think having a business partner to bounce those vulnerabilities off of and be like “this is what I’m truly thinking and I’m seriously concerned” is important. For him to be there and validate those feelings, even while disagreeing, is huge. Not only that, but he helped me get through those concerns by asking me to be very specific in those concerns.
“If you ever overhear Ryan and I in a conversation and either one of us says, ‘do the math,’ in a very stern voice, you know that we’re talking about this because numbers usually speak louder and more rationally than the feeling towards certain things,” Ian said. “For us, another thing that we struggled with is strategy. Should we use business partners? Should we go into more tertiary markets? That has allowed us to have those conversations and have a unified theme to help us better understand where we’re at.”
#6: Be ready to admit you are wrong immediately.
As a salesman at a car dealership, it’s really hard to handle the amount of pressure a customer will put on you to give them vital information like the invoice price on the car.
Eventually, you will crack. The problem is that when you go to catch your manager up to speed, and they go “how did they find out the invoice price,” the manager will yell at you for giving them that price.
It’s unpleasant, but the manager needs to know that. It’s vital information to close a car deal. The punishment you get for divulging the invoice price sucks, and it can condition you to lie.
But, for me, I would rather look like an idiot so that everyone is operating in fact.
In the mobile home park business, I try to create an environment that is comfortable for someone to admit that mistake so that we can address it head on.
“One thing that I do when I make a mistake in our partnership is call Ryan right away and I let him know,” said Ian. “That has allowed us to get to the answer. We have a mutual understanding to be as transparent as possible because it helps us get to our goal. We’re not hiding behind an ego. We want to be understanding. That’s one of things that we both do well.”
Here’s the thing, as Ian says, the mistake isn’t as big as you think it is and it’ll be less of a mistake if you can stop it in its tracks.
“I really liked this contractor,” Ian recounted. “He drove from Asheville to Spartanburg to see me because he wanted to get to know me. Little did I know that it was a giant red flag for Ryan and he had a feeling that this wasn’t a good situation, but I gave him money in his name and I got all of the documents signed appropriately. It gave this contractor power and we ended up losing $4,000. Ryan didn’t berate me for that. Now we have a process in place for vetting contractors. We still make mistakes, but it allows us to get better.”
Getting better is exactly what Ian and I are doing, and I couldn’t be more thankful.
The Takeaway
Like dating, a business partnership can grow into something beautiful or break down into a nightmare. It’s all about how you go about it.
When looking for a partnership, don’t rush. This is a defining moment in your life because of the long-term effects you feel from it.
Go out there, put your vetting hats on, and get to it!