A business partnership is a legally binding agreement between two or more people to start a business. Contrary to popular belief, partnerships are much more about money, with partners also getting together to share their skills and time towards a shared common goal. Below, we discuss the type of partnerships you can expect and the advantages of starting a business with a partner.

Types of Business Partnerships

Limited Partnership

Limited partnerships consist of a general partner tasked with the daily operations of a company and limited partners with minimal responsibilities in the running of a company. Unlike the general partner, who has liability for debts that the company faces, limited partners typically have no responsibility for the company’s losses.

General Partnership

Under this agreement, the partners and owners of the business participate in the running of the company and also have liability for the company’s debts and lawsuits.

Limited Liability Partnership

A limited liability business partnership is similar to a limited partnership, with the only difference being that this agreement includes several general partners. This means that several parties are tasked with running the company’s operations.

Advantages of Partnerships

Financial Support

Business partnerships often rely on partners for funding, allowing businesses to pool in significant capital. This provides the necessary funds for working capital, allowing companies to take advantage of various market opportunities to generate substantial revenue.

Boosts Your Credit Score

Business partners can also leverage their combined credit scores when in need of funding, increasing the funding limit for areas such as the purchase of equipment or leasing and buying property. This eliminates the lengthy fund approval process that comes with poor credit scores, increasing funding prospects for such partnerships.

Flexible Operation Terms

Unlike other types of corporations with rigid business structure rules, business partnerships come with flexible management terms. They are also easy to form, with the partners creating a blueprint for the eligibility criteria. Decision-making is also made easy, with each partner aware of their part in the company, whether providing capital, skills or helping with daily errands.

Tax Savings

Partnerships allow businesses to take advantage of savings, with tax laws providing lenient operation terms. This enables companies to avoid high taxes due to income and loss splitting benefits among business partners.

Call Private Client Capital Partners today if you need help accelerating your funding for any of the above partnership structures. We offer various funding options to help you maximize your revenue.