Many businesses start the same way: a conversation, a shared vision, and a handshake. When family is involved, trust often replaces formal agreements.

Things often run smoothly in the beginning, until a lack of clarity starts to surface, and the effects reach your team, your clients, and the business overall.

As the business grows, informal arrangements can create confusion around ownership, roles, and decision-making. And when something changes such as a disagreement, a new partner, or an unexpected life event, those gaps can quickly turn into conflict.

Where things can break down

• Ownership interests become unclear
• Contributions (time, money, ideas) are disputed
• Family relationships are strained by business disagreements
• Exits become complicated and costly

The goal isn’t to expect problems. It’s to protect both the business and the relationship if something shifts.

Where to start

Moving from a handshake to a structured agreement doesn’t have to be complicated, but it does need to be intentional.

Key areas to address include:

• Ownership and roles: Who owns what, and who is responsible for what
• Buy-Sell Agreement: What happens if someone wants out, passes away, or can no longer participate. A well-written agreement can also ensure ownership stays within the family in the event of a divorce or death of an owner.
• Intellectual Property: Who owns the brand, ideas, client lists, or systems created within the business
• Decision-making authority: How major decisions are made and who has final say

These conversations are often easier to have early, when everyone is aligned, rather than later under pressure.

A better way to think about it

Putting agreements in writing isn’t about mistrust. It’s about clarity and peace of mind.

Clear written agreements reduce assumptions, set expectations, and give everyone confidence moving forward, so business decisions don’t follow you to the Thanksgiving dinner table!

If you’re running a business with family or close partners and don’t have formal agreements in place, now is a good time to address it. A simple structure today can prevent bigger challenges later.

Working with family or friends without clear agreements?

We can help you put the right structure in place.
Clearly and thoughtfully.
Contact Chase Law Group

WWW.CHASELAWMB.COM
310-545-7700

_{Please note that this article is for informational purposes only and should not be considered legal advice and does constitute an attorney-client relationship. It is recommended to consult with an attorney directly for specific guidance pertaining to your business and its practices.}