Shareholder Prenups

In the last 6 months I’ve been involved in three shareholder disputes. In each the dispute could have been avoided if the parties had thought about what things would look like if they fell out with each other.

It’s understandable, of course. You’ve just started a business – positivity and enthusiasm are giving you the momentum to create something out of nothing. The last thing you want is a dose of negativity slowing you down.

On the other hand, this thing you are creating is a business, not a hobby. Thinking like a business person is not optional – it’s imperative, especially if you have family relying on you. It’s better to address these issues now, when everyone is in a positive and generous state of mind, than postpone them until people are angry and unhappy.

It’s a bit like brushing your teeth. It’s pretty dull and uninteresting, but it’s better than being worked on by a dentist.

Or, as a dentist replied when asked if it was necessary to floss each tooth – “not at all, only the ones you want to keep”.