Adding a new partner

What the new partner doesn't know

‘That's how we've always done it’ isn't much of an introduction. Existing partners may know who handles difficult clients or takes time off in summer. A new partner doesn't. Write down those assumptions and expectations instead of making them learn by stepping on toes.

What to align on

• What share they get, and whether they earn it over time
• What they're contributing and what they're responsible for
• Which decisions they're part of from day one
• How pay and profit sharing change
• What happens if it doesn't work out

Revisit the original deal too

Adding a partner is a good moment for the existing partners to check whether what they agreed years ago still matches how they work today.

Three or more partners

With more people, every partner should answer for themselves, and questions about contributions, roles, and time should be asked about each person individually.

How much ownership should a new partner get?

There's no standard number. It depends on what they bring, what the business is already worth, and how much the existing partners built before they arrived. Many businesses have a new partner earn their share over a few years instead of getting it all on day one, so everyone has time to see whether the fit works.

Should a new partner buy in or earn in?

Either can work, and plenty of deals mix the two. A buy-in puts cash into the business or pays the existing partners. Earning in ties ownership to time and effort. Talk through which one matches what the new partner is actually contributing, then have a lawyer document the version you choose.

Do the existing partners need to agree first?

Yes. Before you talk terms with the new person, the current partners should agree with each other on what share is on offer, what role is open, and what decisions the new partner joins. Disagreements between existing partners tend to surface in front of the new one if you skip this step.

What if the new partner doesn't work out?

Plan for it now, while everyone is optimistic. Agree on a trial period, what happens to any ownership they've earned, and how a departure gets handled. Writing it down early is kinder than improvising later. If it reaches a dispute or a buyout, each partner should talk to a lawyer of their own.

How does Stay Partners help when adding a partner?

Each partner, new and existing, answers the same questions privately. Questions about contributions, roles, and time are asked about each person individually. You then compare answers, work through differences, and keep the wording you all accept in a shared MOU that's not intended to be legally binding.