My thoughts on ending a partnership with 12 months of hindsight.
Agility was incorporated in 2002. I was working as a freelance web developer and the work load became too much for me to handle on my own. So, I convinced my high school friend Jon Voigt to quit his job and partner with me on a new venture.
We found success early and grew like crazy for the first 9 years, earning money, awards and accolades along the way. It was awesome.
Then, we leveled off.
When business was booming, it was all high fives and backslapping. Every decision we made seemed easy and brilliant. Everyone bought into the culture. No one questioned our vision.
When things started going south, the fingers started pointing. Suddenly, ideas, decisions and the potential of the company were called into question.
It got tense.
Service revenue was down, so we decided to focus on the recurring revenue generated by our content management software. This eliminated some positions. Others, worried about their job, left.
It got tenser.
Eventually this tension was more than even the founders could bear. Something had to give.
Surrender to what is…
No one wants to leave their own company. It’s like leaving your baby on a street corner. But sometimes change is the best thing for both yourself and the company.
I wasn’t the initiator of the breakup — Jon didn’t like the new strategy and wanted out. Having recently read Jim Collins’ book Great by Choice, I sought out the opportunity in this profound luck event.
I was excited about the prospect of gaining full control of the business. Partnerships are great and all but when you’re on equal footing, the constant jockeying and battling can be exhausting. I figured that the universe was giving me a chance to shine on my own.
Selling shares is hard…
Jon began searching for someone to buy his shares.
It’s hard enough to find investors when times are good. Hawking shares of a company you want to leave is damn near impossible. After 10 months of searching, buyers were scarce.
I get it. If the company is so great, why are you leaving?
So now what?
Winding it down is harder…
Pivoting the company from services to product was not straightforward. It took every ounce of energy I had to re-position the company — smack dab into a saturated market. With Jon leaving and the continuing struggle on the horizon, I decided it might be best to just wind things down.
That’s when Jon made me an offer that I couldn’t refuse. Like I legally couldn’t refuse it. I didn’t have the money to counter and our shotgun clause made the outcome clear.
The lawyers don’t have to make out like bandits…
When Jon told me that he wanted to leave, the first thing that popped into my head was how much is this going to cost me? I’m frugal. The arch nemesis of the frugal is the lawyer. A friend who had gone through a similar split advised me to budget $40,000 — $60,000 in legal fees to separate the company.
I wanted no part in that.
Luckily, Jon and I were close friends with 20 years of history. We had the best defense against lawyer gouging on our side — Trust.
We came up with a rough valuation of the company based on revenue and agreed to terms over email in 2 days. We showed these terms to our corporate lawyer, he wrote them up, and we signed it. All told, it took 3 weeks and cost $4,000.
Friendship is more important than money…
When I went into business for myself, the top priority was to make a pile of money. As the business progressed and I gained life experience, the importance of money diminished. Don’t get me wrong — I love money. But after a certain point, the gains to well-being become incremental with every dollar earned.
I went into business with Jon because he was my friend. He was qualified as well, but I wouldn’t have chosen Jon as a partner if I didn’t think we would have a blast running a company together.
And we did.
But all good things come to an end. It was critical that our friendship survived the split.
And it has.
It wasn’t my idea, but it was a good idea…
In 11 years as CEO of Agility, I never considered leaving. When asked at my last performance review with Jon, I told him I was in it for another 11 years. Agility was me and I was Agility for as far as the eye could see.
Then, one day I woke up and I was no longer the CEO of Agility. And yet both I and the company continued to exist. It set in that being CEO of Agility was no more than a job and I was no more than an employee.
That might sound demoralizing, but it was actually liberating. I put so much of my self-worth into being in charge of a company, that I forgot what it meant to be in charge of my life.
Sometimes, the best ideas come out of left field and smack you in the face. Resisting the flow of the universe is futile.
12 months later, I recognize that Agility was my first of many entrepreneurial experiences. It was the perfect launching pad for what would come next.
I’m a partner and VP at Argenia Systems Inc. — a product engineering firm that helps people lead safer, healthier lives. It’s my second business after Agility which I founded in 2002 and sold in 2013. Medium is good for the soul — especially if you follow me ☺ twitter.com/michaelassad