The Partner Marriage Framework: The "Pre-LOI" Alignment
Phase 1: The "Vision & Values" Alignment (The Dating Phase)
Before discussing money, discuss the "Why."
The 5-Year Exit
Do you want to build a "lifestyle" business to hold forever, or are you looking for a "flip" in 3–5 years?
Risk Tolerance
How do we handle a "down quarter"? Are we okay with taking on more debt to grow, or do we prioritize a "debt-free" balance sheet?
Core Values
What is the "non-negotiable" company culture? (e.g., "Customer first at all costs" vs. "Profitability first").
Work Ethic Expectations
Does the Operator expect to work 80 hours a week? Does the Investor expect a weekly 3-hour deep dive, or a monthly 15-minute summary?
Phase 2: The "Pre-Nup" (Roles & Responsibilities)
Who has the final say when the "check engine" light comes on?
The "Sweat Equity" vs. "Hard Equity" Split: How is the ownership divided? If the Catalyst provides 90% of the cash and the Operator provides 100% of the labor, what is the fair equity split? (Common EMBA models include "Vesting" schedules for the Operator's equity).
Phase 3: The "In Sickness & In Health" (Conflict & Exit)
Partnerships don't usually fail because of the business; they fail because of "Life happened."
- The "Buy-Sell" Provision: If one partner wants out, how is the business valued? (e.g., a fixed multiple of EBITDA).
- The "Drag-Along" Right: If the Catalyst finds a buyer for 100% of the company, can they force the Operator to sell their shares too?
- The Death/Disability Clause: What happens if the Operator can no longer work? Is there "Key Person" insurance to buy out their family's shares?
- The "Disagreement" Protocol: If you are 50/50 partners and you can't agree, who is the 3rd-party tie-breaker? (A trusted mentor, a Rev Global advisor, etc.).
🚩 Red Flags to Watch For
If your potential partner says any of the following, pause the deal:
"We don't need to put the role descriptions in writing; we'll figure it out as we go."
"I'm only doing this until I find a better corporate role."
"I'm not comfortable with you having access to the bank accounts."
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