Before understanding why partnerships are important in Black Business Ownership, let’s first define what a partnership is. A partnership is a relationship between two or more people in business or trade, and all the people within the group contribute money, labor/skill and property/shares. Whatever revenue comes in, it belongs to all in partnership. Whatever losses occur, well, they all take a loss.
Now, as far as why partnerships in Black business ownership is very important, there are several reasons.
- There is less a financial burden on one person. Instead, all partners share the burden, making it economically a safer investment and less risky. For instance, instead of one solopreneur putting all his own money in, hoping that the business succeeds, in a partnership, the expenses are shared and no one person looses all they have.
- Duty is shared with partnerships. Instead of one person having to do and know it all, partners can determine who has a particular skill, such as finance, and that person will be over the accounting. Another could be over management, while one could head marketing.
- Ideas are constant. Not being innovative can quickly destroy a business. In a partnership, various perspectives come together to which great ideas are born, keeping up with trends and more.
- Necessary support system – Life can change in the blink of an eye, so it’s great to have a support system and back up whenever necessary. Partnerships can do that.
Throughout Black Entrepreneur History, African Americans pulled together and functioned beautifully in partnerships in order to found hotels, banks and more. Consider Black Wall Street businessmen Ottowa Gurley and JB Stratford who came together with ideas to grow the area.