{"id":12565,"date":"2024-07-26T17:29:53","date_gmt":"2024-07-26T16:29:53","guid":{"rendered":"https:\/\/www.qualitycompanyformations.co.uk\/blog\/?p=12565"},"modified":"2025-10-20T14:32:26","modified_gmt":"2025-10-20T13:32:26","slug":"starting-a-company-with-someone-else","status":"publish","type":"post","link":"https:\/\/www.qualitycompanyformations.co.uk\/blog\/starting-a-company-with-someone-else\/","title":{"rendered":"Starting a company with someone else: what you need to know"},"content":{"rendered":"<p class=\"ai-optimize-6 ai-optimize-introduction\"><span style=\"font-weight: 400;\">If you\u2019re thinking of starting a company with someone else, there are several considerations to make before you take the first step. Sure, it\u2019s great to have a friend or family member in business with you for support, extra brain power, and stress relief. But is it all as rosy as it sounds?<\/span><\/p>\n<p class=\"ai-optimize-7\"><span style=\"font-weight: 400;\">In this blog, we advise how to approach starting a company with someone else. You\u2019ll need to decide who will undertake crucial roles, understand your roles and responsibilities, and learn about the legal considerations. We also explore the pros and cons of starting a company with someone else.<\/span><\/p>\n<p class=\"ai-optimize-125\">      <div class=\"shortcode shortcode-key-takeaways bg-light text-dark marker:text-dark rounded-md p-6 last:mb-0\" role=\"alert\">\r\n        <h2 class=\"flex items-center text-xl font-semibold text-dark my-0\">Key takeaways<\/h2>\r\n        <div class=\"text-left flex-auto [&>*]:font-normal [&>a]:text-link [&>a]:no-underline [&>a:hover]:underline [&>li]:marker:!text-dark\">\r\n          <\/p>\n<ul>\n<li class=\"ai-optimize-126\">Clearly define roles and responsibilities to prevent misunderstandings and ensure effective collaboration in your business partnership.<\/li>\n<li class=\"ai-optimize-126\">Create a shareholders&#8217; agreement to protect all members&#8217; rights and outline operational guidelines for your company.<\/li>\n<li class=\"ai-optimize-126\">Evaluate your partner\u2019s skills and compatibility to avoid potential conflicts and power struggles in your business venture.<\/li>\n<\/ul>\n<p class=\"ai-optimize-125\">        <\/div>\r\n      <\/div>\r\n    <\/p>\n<h2 class=\"ai-optimize-8\" class=\"ai-optimize-8\" id=\"decide-who-will-own-and-who-will-run-the-company\">Decide who will own and who will run the company<\/h2>\n<p class=\"ai-optimize-9\"><span style=\"font-weight: 400;\">First, you must decide who will own the company (be a shareholder) and who will run it day-to-day (be a director). If you\u2019re starting a company with more than two people, don\u2019t worry; multiple people can hold each of these positions.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-10\" class=\"ai-optimize-10\" id=\"legal-requirements\">Legal requirements<\/h3>\n<p class=\"ai-optimize-11\"><span style=\"font-weight: 400;\">Depending on the type of company you want to start, you\u2019ll need to meet the minimum appointment requirements. A private company limited by shares requires at least one shareholder and one director (one person can be both).\u00a0\u00a0<\/span><\/p>\n<p class=\"ai-optimize-12\"><span style=\"font-weight: 400;\">When you have multiple people, you can assign these roles as you wish. For example, if there are two of you, you can both be shareholders and directors, or you can split the roles between you.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-13\">      <div class=\"shortcode shortcode-image\">\r\n        <a href=\"https:\/\/www.nationwidefinance.co.uk\/eligibility-checker\/?utm_source=qualitycompanyformations&amp;utm_medium=refer&amp;utm_campagin=website\" data-wpel-link=\"external\" target=\"_blank\" rel=\"noopener noreferrer\">\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-brand.s3.eu-west-1.amazonaws.com\/assets\/images\/nationwide-banner--mobile.png?v=2\"\r\n            alt=\"Helping businesses get the finance they need.\"\r\n            class=\"rounded-md md:hidden\"\r\n            loading=\"lazy\"\r\n          \/>\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-brand.s3.eu-west-1.amazonaws.com\/assets\/images\/nationwide-banner--desktop.png?v=2\"\r\n            alt=\"Helping businesses get the finance they need.\"\r\n            class=\"rounded-md hidden md:block\"\r\n            loading=\"lazy\"\r\n          \/>\r\n        <\/a>\r\n      <\/div>\r\n    <\/p>\n<p class=\"ai-optimize-14\"><span style=\"font-weight: 400;\">The rules are the same for a company limited by guarantee (a not-for-profit organisation, such as a charity). The only difference is that shareholders are called guarantors.<\/span><\/p>\n<p class=\"ai-optimize-15\"><span style=\"font-weight: 400;\">In a limited liability partnership (LLP), you can have two or more partners. These individuals are known as designated members, which are equivalent to shareholders.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-16\"><span style=\"font-weight: 400;\">You must have at least two designated members appointed in an LLP at all times to undertake administrative and managerial responsibilities. You can also choose to have non-designated members, who generally have fewer responsibilities.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-17\"><span style=\"font-weight: 400;\">For public limited companies (PLCs), you need at least two directors and at least one shareholder, so you need at least two people. Both can be directors, and one can be a shareholder, or you can bring in a third person to take on one of these essential roles.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-18\"><span style=\"font-weight: 400;\">PLCs must also legally appoint a company secretary (an optional role for the other company types), for which there are specific qualifying criteria. You can find details of this in <\/span><a href=\"https:\/\/www.legislation.gov.uk\/ukpga\/2006\/46\/part\/12#:~:text=(a)that%20he%20has%20held,specified%20in%20subsection%20(3)%3B\" data-wpel-link=\"external\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">section 46 of the Companies Act 2006<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p class=\"ai-optimize-19\"><span style=\"font-weight: 400;\">For the purpose of this article, we will focus on the most popular business structure in the UK, private companies limited by shares.<\/span><\/p>\n<h3 class=\"ai-optimize-20\" class=\"ai-optimize-20\" id=\"who-can-be-a-director\">Who can be a director?<\/h3>\n<p class=\"ai-optimize-21\"><span style=\"font-weight: 400;\">Company directors have a great deal of responsibility and an extensive list of ongoing duties. These include:<\/span><\/p>\n<ul>\n<li aria-level=\"1\" class=\"ai-optimize-22\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Promoting the success of the company\u00a0<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-23\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Complying with certain laws and regulations (such as employment and consumer law, as well as health and safety)\u00a0<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-24\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Maintaining statutory filing and reporting obligations (such as the annual confirmation statement and registering the company for business taxes)<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-25\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Maintaining the company\u2019s statutory Register of Members<\/span><\/li>\n<\/ul>\n<p class=\"ai-optimize-26\"><span style=\"font-weight: 400;\">Directors make most business decisions (bar high-level ones, like taking out a sizeable business loan, which requires shareholder approval) and act on behalf of the company, so there\u2019s a great deal of responsibility.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-27\"><span style=\"font-weight: 400;\">Generally, anyone can be a director as long as they are:<\/span><\/p>\n<ul>\n<li aria-level=\"1\" class=\"ai-optimize-28\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Over 16 years old<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-29\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Not disqualified from being a director by a court order<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-30\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Not disqualified by the company\u2019s memorandum and articles of association<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-31\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Not an undischarged bankrupt<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-32\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Not the company\u2019s auditor<\/span><\/li>\n<\/ul>\n<p class=\"ai-optimize-33\"><span style=\"font-weight: 400;\">They should also possess certain qualities and skills to be successful in the role, such as:<\/span><\/p>\n<ul>\n<li aria-level=\"1\" class=\"ai-optimize-34\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Leadership<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-35\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Risk management<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-36\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">People management<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-37\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Legal and governance knowledge<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-38\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Communication<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-39\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Confidence<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-40\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Integrity and honesty<\/span><\/li>\n<li aria-level=\"1\" class=\"ai-optimize-41\" style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Discipline<\/span><\/li>\n<\/ul>\n<p class=\"ai-optimize-42\"><span style=\"font-weight: 400;\">When appointing the director(s) for your new company, consider the above and ensure everyone knows the role and is well-equipped to do it.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-43\" class=\"ai-optimize-43\" id=\"who-can-be-a-shareholder\">Who can be a shareholder?<\/h3>\n<p class=\"ai-optimize-44\"><span style=\"font-weight: 400;\">Shareholders are the company&#8217;s owners. Unlike directors, they are not typically involved in the daily running of the business; their primary role is to assume limited liability for the company\u2019s debts and make important business decisions.<\/span><\/p>\n<p class=\"ai-optimize-46\"><span style=\"font-weight: 400;\">Unlike directors, shareholders do not have specific criteria. Anyone of any age can be a shareholder. However, due to their financial responsibility, a shareholder should be comfortable with the limited risk they are taking.<\/span><\/p>\n<p class=\"ai-optimize-47\"><span style=\"font-weight: 400;\">If you want to, you can apply certain restrictions to who can and can\u2019t be a shareholder in your company (e.g. minors). You can add these provisions to your articles of association, which we explain later.<\/span><\/p>\n<h2 class=\"ai-optimize-48\" class=\"ai-optimize-48\" id=\"discuss-portion-of-ownership-and-shareholder-rights\">Discuss portion of ownership and shareholder rights<\/h2>\n<p class=\"ai-optimize-49\"><span style=\"font-weight: 400;\">Next, you need to agree on the portion of ownership and rights each shareholder should have.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-50\" class=\"ai-optimize-50\" id=\"issuing-shares\">Issuing shares<\/h3>\n<p class=\"ai-optimize-51\"><span style=\"font-weight: 400;\">Will you be equal shareholders, or will your ownership vary? Will you both have voting rights? This is your decision, but you should carefully consider the value each owner brings to the company and ensure they are fairly rewarded for their input, be it financial or otherwise.<\/span><\/p>\n<p class=\"ai-optimize-52\">      <ul class=\"!marker:text-primary *:!marker:text-primary\">\r\n                              <li class=\"marker:!text-primary\">\r\n            <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/blog\/share-splits-how-to-subdivide-company-shares\/\" class=\"font-semibold\" data-wpel-link=\"internal\"><span>Share splits &#8211; how to subdivide company shares<\/span><\/a>\r\n          <\/li>\r\n                            <li class=\"marker:!text-primary\">\r\n            <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/blog\/prescribed-particulars\/\" class=\"font-semibold\" data-wpel-link=\"internal\"><span>Prescribed particulars &#8211; the rights attached to company shares<\/span><\/a>\r\n          <\/li>\r\n                            <li class=\"marker:!text-primary\">\r\n            <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/blog\/get-articles-of-association\/\" class=\"font-semibold\" data-wpel-link=\"internal\"><span>How do I get articles of association?<\/span><\/a>\r\n          <\/li>\r\n                        <\/ul>\r\n    <\/p>\n<p class=\"ai-optimize-53\"><span style=\"font-weight: 400;\">When starting a new company with someone else, you might wonder how many shares each owner should hold. Each shareholder must own at least one share. So, if there are two shareholders, you\u2019ll need to issue two shares (you can always issue more later), making you equal partners with a 50% stake in the company.<\/span><\/p>\n<p class=\"ai-optimize-54\"><span style=\"font-weight: 400;\">There is no limit to how many shares you can issue, but remember to make strategic decisions. The more shares you give away, the more diluted your ownership and control becomes.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-55\" class=\"ai-optimize-55\" id=\"shareholder-rights\">Shareholder rights<\/h3>\n<p class=\"ai-optimize-56\"><span style=\"font-weight: 400;\">Different shareholders can have different rights. For example, dividend rights allow them to receive a percentage of the company\u2019s profits, and voting rights allow them to attend general meetings and participate in important decision-making.\u00a0<\/span><\/p>\n<h2 class=\"ai-optimize-57\" class=\"ai-optimize-57\" id=\"sign-the-memorandum-of-association\">Sign the memorandum of association<\/h2>\n<p class=\"ai-optimize-58\"><span style=\"font-weight: 400;\">Now that you\u2019re clear on who the company owners and directors will be, you should familiarise yourself with the memorandum of association. This is a short document created by Companies House, the registrar of UK companies that all founding shareholders of a limited must sign upon incorporation.<\/span><\/p>\n<p class=\"ai-optimize-59\"><span style=\"font-weight: 400;\">The memorandum effectively confirms that each shareholder agrees to be an owner and take up at least one share in the company. It will be attached to your articles of association, which we go into next.<\/span><\/p>\n<h2 class=\"ai-optimize-60\" class=\"ai-optimize-60\" id=\"set-the-terms-in-your-articles-of-association\">Set the terms in your articles of association<\/h2>\n<p class=\"ai-optimize-61\"><span style=\"font-weight: 400;\">Your articles of association are your company\u2019s constitution. In other words, it\u2019s the internal rulebook and contract between the owners (and between the company and the owners) that outlines how the business will be structured and managed. As an incorporated company in the UK, you are legally obligated to have articles of association (and memorandum) for your organisation.<\/span><\/p>\n<p class=\"ai-optimize-62\"><span style=\"font-weight: 400;\">It includes details such as how business decisions are to be made, who has the right to make them, shareholders&#8217; rights and liabilities, directors\u2019 powers, and how company profits are to be distributed.\u00a0<\/span><\/p>\n      <div class=\"shortcode shortcode-image\">\r\n        <a href=\"https:\/\/acn.ionos.co.uk\/aff_c?offer_id=3&amp;aff_id=8964&amp;aff_sub=BLOG\" data-wpel-link=\"external\" target=\"_blank\" rel=\"noopener noreferrer\">\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-brand.s3.eu-west-1.amazonaws.com\/assets\/images\/ionos-banner--mobile.png\"\r\n            alt=\"FREE .co.uk Domain Name.\"\r\n            class=\"rounded-md md:hidden\"\r\n            loading=\"lazy\"\r\n          \/>\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-brand.s3.eu-west-1.amazonaws.com\/assets\/images\/ionos-banner--desktop.png\"\r\n            alt=\"FREE .co.uk Domain Name.\"\r\n            class=\"rounded-md hidden md:block\"\r\n            loading=\"lazy\"\r\n          \/>\r\n        <\/a>\r\n      <\/div>\r\n    \n<p class=\"ai-optimize-63\"><span style=\"font-weight: 400;\">Usually, basic private companies limited by shares, guarantee companies, and PLCs with one director and shareholder opt for model articles, which are default articles provided by Companies House. However, as you are starting a company with someone else, bespoke articles are more suitable.<\/span><\/p>\n<p class=\"ai-optimize-64\"><span style=\"font-weight: 400;\">\u00a0<\/span><\/p>\n<p class=\"ai-optimize-65\"><span style=\"font-weight: 400;\">Bespoke articles allow you to tailor the terms of your agreement to suit your individual needs, circumstances, and company objectives. For instance, if you want to issue multiple share classes or appoint more than one owner. Your articles can be amended later if needed, but you should carefully formulate the terms that each shareholder and director is happy with.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-66\"><span style=\"font-weight: 400;\">Bespoke articles can be complex to create yourself, so we recommend seeking professional assistance. At QCF, our expert team can help <\/span><span style=\"font-weight: 400;\"><span style=\"box-sizing: border-box; margin: 0px; padding: 0px;\">draft your articles as <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/corporate-services\/\" data-wpel-link=\"internal\">one of our corporate services<\/a>, ensuring that it is tailored to your company\u2019s <\/span>requirements.\u00a0<\/span><\/p>\n<h2 class=\"ai-optimize-67\" class=\"ai-optimize-67\" id=\"create-relevant-contracts\">Create relevant contracts<\/h2>\n<p class=\"ai-optimize-68\"><span style=\"font-weight: 400;\">In addition to your articles, we recommend creating relevant contracts to safeguard your company and its stakeholders.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-69\" class=\"ai-optimize-69\" id=\"shareholders-agreement\">Shareholders&#8217; agreement<\/h3>\n<p class=\"ai-optimize-70\"><span style=\"font-weight: 400;\">This document concerns only the company owners and is supplementary to the articles of association. Its primary function is to describe how the company should operate, detail each member\u2019s rights and obligations, and, ultimately, protect their investment.<\/span><\/p>\n<p class=\"ai-optimize-71\">      <ul class=\"!marker:text-primary *:!marker:text-primary\">\r\n                              <li class=\"marker:!text-primary\">\r\n            <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/blog\/what-is-a-shareholders-agreement-and-why-do-i-need-one\/\" class=\"font-semibold\" data-wpel-link=\"internal\"><span>What is a shareholders\u2019 agreement and why do I need one?<\/span><\/a>\r\n          <\/li>\r\n                            <li class=\"marker:!text-primary\">\r\n            <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/blog\/set-up-limited-company-4-steps\/\" class=\"font-semibold\" data-wpel-link=\"internal\"><span>Set up a limited company in 4 easy steps<\/span><\/a>\r\n          <\/li>\r\n                            <li class=\"marker:!text-primary\">\r\n            <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/blog\/memorandum-and-articles-association\/\" class=\"font-semibold\" data-wpel-link=\"internal\"><span>Memorandum and articles of association for UK limited companies<\/span><\/a>\r\n          <\/li>\r\n                        <\/ul>\r\n    <\/p>\n<p class=\"ai-optimize-72\"><span style=\"font-weight: 400;\">This agreement helps ensure that all members are treated fairly and their rights are protected, especially minority shareholders.<\/span><\/p>\n<p class=\"ai-optimize-73\"><span style=\"font-weight: 400;\">If you\u2019re starting a company with a friend or family member, you might feel that you trust each other enough to omit a shareholders\u2019 agreement, especially as it\u2019s not a legal requirement. However, it\u2019s still a good idea to create this contract.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-74\"><span style=\"font-weight: 400;\">You never know what could happen, so this is a practical way to reduce risk and protect all members\u2019 best interests. If you need assistance with your shareholders\u2019 agreement, this service is also one of the corporate services QCF can provide.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-75\" class=\"ai-optimize-75\" id=\"directors-service-agreement\">Directors&#8217; service agreement<\/h3>\n<p class=\"ai-optimize-76\"><span style=\"font-weight: 400;\">A director\u2019s service agreement is another beneficial contract to put in place when starting a company with someone else, especially if you plan to have more than one director. This agreement covers the directors\u2019 specific duties, both statutory and general, and ensures that all parties know them.<\/span><\/p>\n<p class=\"ai-optimize-77\"><span style=\"font-weight: 400;\">While these details can be found in your articles of association and employment contract, a directors\u2019 service agreement is a more extensive document focusing on the director\u2019s role and obligations.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-78\" class=\"ai-optimize-78\" id=\"non-disclosure-agreement\">Non-disclosure agreement<\/h3>\n<p class=\"ai-optimize-79\"><span style=\"font-weight: 400;\">When starting a company with someone else, having a non-disclosure agreement is a good idea. This is not essential, but could be helpful if you want to ensure that confidential company information is kept safe between yourself and your fellow partners.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-80\"><span style=\"font-weight: 400;\">If you plan to employ people straight away, or if directors also intend to be employees, you can ask them to sign a non-disclosure agreement to ensure that private information about the business stays within the confines of your organisation.<\/span><\/p>\n<h3 class=\"ai-optimize-81\" class=\"ai-optimize-81\" id=\"employment-contracts\">Employment contracts<\/h3>\n<p class=\"ai-optimize-82\"><span style=\"font-weight: 400;\">If you\u2019re going to have staff as soon as you start a company with someone else, or if directors are also going to be employees, employment contracts are essential. These documents clarify staff members\u2019 terms of employment, their and the company\u2019s duties, and the company\u2019s rules and policies.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-83\"><span style=\"font-weight: 400;\">Again, an employment contract is not a legal requirement, but ensuring that all parties are protected and aware of their responsibilities is highly recommended.<\/span><\/p>\n<h2 class=\"ai-optimize-84\" class=\"ai-optimize-84\" id=\"benefits-of-starting-a-company-with-someone-else\">Benefits of starting a company with someone else<\/h2>\n<p class=\"ai-optimize-85\"><span style=\"font-weight: 400;\">We\u2019ve covered the primary checklist for starting a company with someone else. Let\u2019s now examine the benefits.<\/span><\/p>\n<h3 class=\"ai-optimize-86\" class=\"ai-optimize-86\" id=\"1-shared-workload\">1. Shared workload<\/h3>\n<p class=\"ai-optimize-87\"><span style=\"font-weight: 400;\">We\u2019ve explained that directors have many duties and lawful obligations. This can be an overwhelming job for inexperienced, sole directors. So, if you\u2019re starting a company with someone else, appointing more than one director to share the workload could be beneficial.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-88\" class=\"ai-optimize-88\" id=\"2-access-to-support\">2. Access to support<\/h3>\n<p class=\"ai-optimize-89\"><span style=\"font-weight: 400;\">Running a business alone can be alienating. Only you know what\u2019s truly going on in your business, and only you can deal with it. Support is, therefore, vital for business owners.<\/span><\/p>\n<p class=\"ai-optimize-90\"><span style=\"font-weight: 400;\">By starting a company with someone else, you\u2019ll share those experiences and be able to support one another. Whether you\u2019re working towards a mutual business goal, or need help with a personal matter, it\u2019s useful to have someone who knows what you\u2019re going through and can offer guidance. <\/span><\/p>\n<h3 class=\"ai-optimize-91\" class=\"ai-optimize-91\" id=\"3-wider-scope-of-skills-knowledge-and-contacts\">3. Wider scope of skills, knowledge, and contacts<\/h3>\n<p class=\"ai-optimize-92\"><span style=\"font-weight: 400;\">When you start a business with someone else, each person brings their skills, knowledge, and contacts to the table &#8211; the more, the better. This could significantly improve your chances of success compared to if you were to start a business alone.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-93\">      <div class=\"shortcode shortcode-image\">\r\n        <a href=\"https:\/\/portal.worldfirst.com\/register?affiliate_id=10386\" data-wpel-link=\"external\" target=\"_blank\" rel=\"noopener noreferrer\">\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-brand.s3.eu-west-1.amazonaws.com\/assets\/images\/worldfirst-banner-new--mobile.jpg\"\r\n            alt=\"Worldfirst - Pay and get paid in multiple currencies\"\r\n            class=\"rounded-md md:hidden\"\r\n            loading=\"lazy\"\r\n          \/>\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-brand.s3.eu-west-1.amazonaws.com\/assets\/images\/worldfirst-banner-new--desktop.jpg\"\r\n            alt=\"Worldfirst - Pay and get paid in multiple currencies.\"\r\n            class=\"rounded-md hidden md:block\"\r\n            loading=\"lazy\"\r\n          \/>\r\n        <\/a>\r\n      <\/div>\r\n    <\/p>\n<p class=\"ai-optimize-94\"><span style=\"font-weight: 400;\">Also, if someone has a particular field of expertise or is exceptionally skilled in something, it\u2019ll make appointing roles easier, and you\u2019ll know that you have the best person for the job.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-95\"><span style=\"font-weight: 400;\">For example, if someone is a strong leader, they might be best suited as a director. Or, if someone has substantial marketing experience, they could take ownership of this part of the business. Otherwise, if you were to start a company on your own, you\u2019d have to take care of all areas of the business yourself, or employ someone to do it.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-96\" class=\"ai-optimize-96\" id=\"4-make-better-decisions\">4. Make better decisions<\/h3>\n<p class=\"ai-optimize-97\"><span style=\"font-weight: 400;\">Running a company involves constant decision-making. Some are easier than others, but even the simple ones can be burdensome for a single person.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-98\"><span style=\"font-weight: 400;\">If you start a company with someone else, you can discuss and explore these situations together. You\u2019ll benefit from more insight, reason, and perspective, which could help you make better business decisions.<\/span><\/p>\n<h3 class=\"ai-optimize-99\" class=\"ai-optimize-99\" id=\"5-shared-liability\">5. Shared liability<\/h3>\n<p class=\"ai-optimize-100\"><span style=\"font-weight: 400;\">Another important advantage is that shared owners have shared liability over the company\u2019s debt. Unlike a single shareholder or a sole trader, you share the financial risk between you, so that if something goes wrong, the impact is reduced.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-101\" class=\"ai-optimize-101\" id=\"6-cost-saving\">6. Cost saving<\/h3>\n<p class=\"ai-optimize-102\"><span style=\"font-weight: 400;\">Depending on the type of company you want to start, you could face significant start-up costs. Entrepreneurs often have to dip into their personal savings to get their businesses off the ground. However, starting a business with someone else allows you to split those expenses and increase your initial funding.\u00a0<\/span><\/p>\n<h2 class=\"ai-optimize-103\" class=\"ai-optimize-103\" id=\"potential-problems\">Potential problems<\/h2>\n<p class=\"ai-optimize-104\"><span style=\"font-weight: 400;\">There are also some possible drawbacks to think about.<\/span><\/p>\n<h3 class=\"ai-optimize-105\" class=\"ai-optimize-105\" id=\"1-it-can-complicate-your-relationship\">1. It can complicate your relationship<\/h3>\n<p class=\"ai-optimize-106\"><span style=\"font-weight: 400;\">You\u2019re likely thinking of starting a company with someone you already know, maybe a friend or relative. While going into business with a loved one can be exciting, it can also complicate your relationship if you\u2019re not careful.<\/span><\/p>\n<p class=\"ai-optimize-107\"><span style=\"font-weight: 400;\">Let\u2019s say you have a disagreement at work (we\u2019ll be honest, this is likely). It\u2019s difficult to draw a line under it at the office door and not let it affect your private lives.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-108\"><span style=\"font-weight: 400;\">Equally, a personal matter could interfere with business and distract you from acting in the company&#8217;s best interest. That\u2019s why it\u2019s incredibly important to set rules and boundaries at the very beginning.<\/span><\/p>\n<h3 class=\"ai-optimize-109\" class=\"ai-optimize-109\" id=\"2-they-might-not-be-a-suitable-candidate\">2. They might not be a suitable candidate<\/h3>\n<p class=\"ai-optimize-110\"><span style=\"font-weight: 400;\">Simply knowing, liking, or getting along with someone isn\u2019t enough to start a company with them. They must possess the right skills and qualities to help prepare your business for success.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-111\"><span style=\"font-weight: 400;\">If they lack vital attributes, they might not necessarily be the best person to start a company with. However, your personal relationship could be clouding your judgement. So, how can you tell if they\u2019re the right fit?<\/span><\/p>\n<p class=\"ai-optimize-113\"><span style=\"font-weight: 400;\">We\u2019d say that effective communication is critical. Do you tend to argue a lot and struggle to reach a resolution? Do your disagreements get heated and out of control? If so, they\u2019re probably not the right fit.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-114\"><span style=\"font-weight: 400;\">It\u2019s also vital that you both know and trust each other no matter what. If either person has skeletons in the closet or lacks confidence in the other, starting a company together might not be the best idea.<\/span><\/p>\n<h3 class=\"ai-optimize-115\" class=\"ai-optimize-115\" id=\"3-power-struggle\">3. Power struggle<\/h3>\n<p class=\"ai-optimize-116\"><span style=\"font-weight: 400;\">If you struggle to relinquish control, you might find it challenging to start a company with someone else. A business partnership means that important decisions are joint, and you navigate your new business venture together.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-117\"><span style=\"font-weight: 400;\">However, if one person is particularly bossy and unable to compromise, you could find yourself in a power struggle, leading to more significant disputes.\u00a0<\/span><\/p>\n<h3 class=\"ai-optimize-118\" class=\"ai-optimize-118\" id=\"4-exit-strategy-complications\">4. Exit strategy complications<\/h3>\n<p class=\"ai-optimize-119\"><span style=\"font-weight: 400;\">Every company need an exit plan. Of course, you hope for the best for your new company, but there\u2019s always a risk that things might not work out.<\/span><\/p>\n<p class=\"ai-optimize-120\"><span style=\"font-weight: 400;\">Other people could complicate this, though. What if you\u2019d prefer to sell the business while your partner favours liquidation? Agreeing on an exit strategy before starting a business with someone else is vital.<\/span><\/p>\n<h2 class=\"ai-optimize-121\" class=\"ai-optimize-121\" id=\"thanks-for-reading\">Thanks for reading<\/h2>\n<p class=\"ai-optimize-122\"><span style=\"font-weight: 400;\">Remember to communicate with your business partner if you\u2019re considering starting a company with someone else. Don\u2019t make assumptions just because you know them &#8211; have clear and frequent discussions about business matters.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-123\"><span style=\"font-weight: 400;\">We also don\u2019t recommend starting a business with someone simply because you\u2019re friends or related. Evaluate each person\u2019s suitability for their prospective role &#8211; including yours. And be sure to protect yourselves and your company by creating relevant contracts.\u00a0<\/span><\/p>\n<p class=\"ai-optimize-124\"><span style=\"font-weight: 400;\">Thanks for reading. We hope you found this blog helpful in preparing to start a company with someone else. If you have any questions about the topics we discussed, post them below, and we\u2019ll get back to you as soon as possible.\u00a0<\/span><\/p>\n      <div class=\"shortcode shortcode-image\">\r\n        <a href=\"https:\/\/www.qualitycompanyformations.co.uk\/fully-inclusive-package\/\" data-wpel-link=\"internal\">\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-quality.s3.eu-central-1.amazonaws.com\/assets\/custom\/images\/blog\/qcf-blog_sidebar.png?v=4\"\r\n            alt=\"Fully Inclusive Package\"\r\n            class=\"md:hidden\"\r\n            loading=\"lazy\"\r\n          \/>\r\n          <img decoding=\"async\"\r\n            src=\"https:\/\/cdn-quality.s3.eu-central-1.amazonaws.com\/assets\/custom\/images\/blog\/qcf-blog_banner.png?v=4\"\r\n            alt=\"Fully Inclusive Package\"\r\n            class=\"hidden md:block\"\r\n            loading=\"lazy\"\r\n          \/>\r\n        <\/a>\r\n      <\/div>\r\n    \n"},"excerpt":{"rendered":"<p>Starting a company with someone else requires careful consideration of roles, responsibilities, and legal structures. Establish ownership and management roles, create articles of association, and draft necessary contracts. While benefits include shared workload and diverse skills, potential challenges like relationship strain and power struggles must also be managed effectively.<\/p>\n","protected":false},"author":20,"featured_media":12596,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1243],"tags":[],"class_list":["post-12565","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-start-your-business"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.5 (Yoast SEO v26.5) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Starting a Company With Someone Else: What You Need To Know<\/title>\n<meta name=\"description\" content=\"If you\u2019re thinking of starting a company with someone else, there are several considerations to make before you take the first step.\" \/>\n<meta name=\"robots\" content=\"index, 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