Best brainstorming practices?

January 30, 2007 1:09 PM

A good buddy of mine and I are thinking of starting a business together. We are meeting tonight for a brainstorming session. The goal is just to start the dialog. We are going to take inventory of our strengths and weaknesses and start to throw ideas out there to research in the coming weeks. What are some good things to discuss in this very preliminary meeting? What are some good ways to make sure we make the most of our time tonight?
posted by ieatwords to work & money (14 comments total)

One thing to do for sure: talk about how you guys resolve disputes? What happens later on when you disagree about something? Can you still be friends?

Also, hire an accountant. Money between friends sucks.
posted by rbs at 1:13 PM on January 30, 2007

Also discuss exit terms. What if one of you wants out of the business in a few years and the other doesn't have the cash or means to buy out the first person's stake?
posted by saffry at 1:15 PM on January 30, 2007

Discuss your tolerance for risk, and how much time/money/other assets you would each be able to put toward the business. If either of you has a spouse, consult with them on these topics before the meeting.
posted by yohko at 1:27 PM on January 30, 2007

And put all of this in writing. Even though you're friends, the topic of this meeting shouldn't be optimistically brainstorming about how awesome life's gonna be together ... you need to balance the optimism with a lot of brainstorming about what you'll do if TSHTF. For instance, as a startup many services (i.e. lease, telecom) will require a personal guarantee from one or the other of you, and they may not let both of you sign it. Who's going to be left holding the cheque if the business fails?
posted by SpecialK at 1:34 PM on January 30, 2007

As someone who has gone into business with friends before, I want to echo saffry's point: discuss exit terms. This is the top priority. Seriously. You may never need them, but it's important that they're understood before you even begin.
posted by jdroth at 1:36 PM on January 30, 2007

take notes- you'll have more and better ideas when you make suggestions "permanent". ideas are like kids on a playground slide. an idea that's being talked about, but not physically recorded, is like a fat kid stuck on the slide- that idea will subtly block the path to new ideas because you'll both mentally hold on to it so you don't forget it. as soon as you write it down, though, you'll let it go because you trust that it's "safe"-- and that means that that particular kid is off the slide and the next kid can come through.
posted by twistofrhyme at 1:36 PM on January 30, 2007 [1 favorite]

How profits (or losses) should be split. And you do need to put everything in writing, in detail(with, possibly, provision for changing it if there's a need). Whether it goes well or not, you don't want either of you left feeling bitter and cheated.
posted by sleeplessunderwater at 1:43 PM on January 30, 2007

Objectives - Exit terms are important, but before that I think you need to be honest with each other (and potentially yourselves) in discussing what you want out of the venture - fame, wealth, a legacy for your children, net positive contribution to society etc. There is little point in partnering with someone if your fundamental reasons for starting a business differ wildly without a discussion on how those aims might be optimally reconciled.

Risk - what are you willing to lay on the line and even lose to make this a success - family time, your house, savings, credit-worthiness, your current lifestyle, friends etc.

Roles - who will do what.

Strengths and weaknesses - but with a twist. State the strengths and weaknesses of each other, in as dispassionate a way as you possibly can. You will argue on this venture, so you may as well get this one out of the way now. You will also be able to start thinking constructively about where the gaps are in your combined skillset. And make no mistake - there will be several.

That all said, someone once said that history is written by those who show up. If you believe in what you are setting out to achieve, don't let anyone derail you.

Best of luck :)
posted by mooders at 1:52 PM on January 30, 2007

You need to be prepared to accept that failure is par for the course, and that it might take a few tries before you achieve success.
posted by Rhomboid at 1:53 PM on January 30, 2007

excellent ideas - just to further mooders' point, do a full SWOT analysis (strengths, weaknesses, opportunities and threats). Find out how much risk each of you can stomach. Absolutely look at exit terms, what you value, where you see yourself in five years, etc. etc. Also discuss timelines of things that could possibly impact your business together (i.e. current employment, finances, changes in status, etc. etc.).

and above all, good luck!
posted by rmm at 2:54 PM on January 30, 2007

Try to make meaning.
posted by avoision at 3:05 PM on January 30, 2007 [1 favorite]

From (hard) experience, exit terms are very important. With two people, a very sticky issue is how decisions about the business are made. Since there never is an ability to have a majority vote, the problem is that you can definitely have a real and intractable disagreement about the direction of the company. In that case, either someone is in charge, and makes a final decision, or the business dissolves. You may want to have a list of things which can only be done by consensus, and one person who is otherwise in charge. You will want to specifically outline the required duties in the business, and whether one partner has the ability to dictate tasks to the other. On the subject of exit terms, a good strategy is to have stock with a vesting schedule, so if one partner drops out, he ultimately gets a smaller share of the company.

More important than all of this is that you be completely comfortable with the trustworthiness and fair dealing of the other partner, even under very difficult circumstances. If you have any doubts, do not go forward with the business. A particular problem with small businesses is that disputes between partners can't practically be litigated, because it is so expensive to do so, and often the lawyers end up getting more money than what is even in dispute. This means that you basically have to trust the other guy to live up to his end of the bargain.

For all of these reasons, I'm convinced that you're much better off starting with three people if you can. It's much easier to cope with the situation where one person is being unreasonable in that circumstance with a majority vote.
posted by cameldrv at 5:01 PM on January 30, 2007

There are some very good points raised above about the human aspects of the business and how those may have an impact in your venture - I'm thinking about a lot of these issues myself lately, having brought more people into my business.

Still, I believe the original question of the best practices for brainstorming still hasn't been answered, and I'll try to move this from the "money / trust / exit terms" discussion, to the creative discussion, which is equally important if you're really going forward with this.

So here are a few brainstorming ideas:

- Keep things visual. You have an idea, and while between two people it may be easy to be on the same page, it doesn't always happen. So, if at all possible, draw, document, build, to make sure your vision is the same. This is probably the most valuable tip (hence it's the first). Only if both want the same thing will things move it that direction.

- Don't be afraid of ideas. Any idea is a good idea, and in a good brainstorming session, you want to get those out (and, again, into paper) as much as possible. You also want to have way too many, so we can weed out the worst ones afterwards. The reason why you don't do it in the first place is because an evolution of a bad idea can be a tremendous idea. So, no ignoring ideas. No "devils advocate" - anything deserves attention.

- Bring fresh people into the idea. Maybe this doesn't need to happen on the first meeting, but you can easily "freeze" your creative juices if you don't keep the drum going. Fresh views into your idea will be extremely valuable. Tell people what you're thinking about, get them at a table, give everyone pens, and hack away at ideas. Seriously, combining the experience of people with their perception of your idea will generate great output.

Hope that helps.
posted by fredoliveira at 6:30 PM on January 30, 2007

Set goals.

Short-term goals with short-term timelines, and long-term goals with long-term strategies. Keep the initial goals simple so they are easily achievable (this will bolster your confidence). The small steps make up the larger path, which can initially seem daunting, but when broken down into its components will be easily manageable.

I set up a company with a couple of my friends when I was still in college, and the biggest problem we faced was that we had absolutely no idea how to set up a company. We had a good product, but no idea of how we would get it "out there." So each step was like a business lesson--first we called a lawyer friend who told us about different business structures (corp, LLC, etc.). Then we called up packaging companies and asked where they got their boxes, then we called the box making companies and asked how we place an order.

Then there was the whole marketing side--again, a bunch of cold-calls to a bunch of places where we could see our product being sold, followed by a bunch of stupid questions that would have probably been obvious to someone with a business degree. Point is, setting a goal like "Get incorporated" is too big... too daunting. Too many unknowns. So, step one was answering those unknowns. Which, for the most part, involved calling up a lot of people we didn't know and asking. Small step, easily achievable.
posted by Civil_Disobedient at 10:33 PM on January 30, 2007