When I consult with entrepreneurs, I find that most are reluctant to even talk about failure.  It is even more important to address this topic if you are entering into a partnership.  Some partnership agreements even cover these issues, if not, I recommend you put some concepts down in writing so there is no misunderstanding if you have to unwind the business.

Especially when you are entering a business with a new partner, it is imperative you answer the following questions:

• How will we value the business if it is unsuccessful?
• Who is going to pay for what when we exit the business?
• What if one partner wants to leave and the other wants to stay?
• How do we handle any residual revenue or assets?
• What happens if one partner decides to pull back from the business or only work part time?

By spending a little time upfront talking about these issues, it could prevent a difficult conversation if the business is failing or someone wants to leave the partnership.