“I’m Running a Business With My Ex. HELP!”

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1:33There's no safe like SimpliSafe. Imagine breaking up with someone and then still having to run a business with them. Sounds like a nightmare, but for at least one person, it is reality. And today on Problem Solvers, I want to play you a podcast episode in which me and a friend of mine, help that person. So, okay, this comes from a podcast that I co-host with my friend Nicole Lappin, best-selling money expert. It is called Help Wanted. You can find Help Wanted wherever you find problem solvers. We have callers call in with their challenges and then we help them through it. And in this episode, well, you heard it.

2:14It's someone running a business with their ex. Pretty tricky. But also we thought not all hope is lost. Anyway, it's the holiday season. I wanted to give you this gift of just a real gem from my other podcast. So here it is from Help Wanted.

2:38This is Help Wanted, the show that makes your work work for you. I'm Jason Pfeiffer, editor-in-chief of Entrepreneur Magazine. And I'm money expert, Nicole Lappin. On Tuesdays, Jason and I answer the helpline and help callers solve their work problems. And on Thursdays, I give you one way to improve your work and build a career or company you love. And it starts now. My question is about running a business with your ex-partner. I've been married for seven years. We recently separated and our business is facing the next stage of growth. Do we take that next step together? And if one of us leaves, who leaves?

3:17And what does that look like for the business? Well, hello, Nicole. Thanks for joining us on Help Wanted. Thanks, Jason, for having me. So before we give you any advice, I feel like we're going to need to know more about what's going on here. Do both of you, for example, want to continue to run the business together? Do you like each other? And generally, what kind of business is it? Okay, so we operate a mobile bicycle workshop. We go into buildings, houses and schools and cycling events, and we service and repair bikes. Me and my ex-husband started this business in 2015. It was a bit of a backyard business.

3:59We were running it out of our garage and it quickly gained momentum. We saw that we were onto something. Throughout COVID, there was a bit of a boom in the bike industry. So our business started to do really, really well. And we thought, okay, we need to start taking this seriously. Unfortunately, at the same time, our marriage ran into a series of difficulties. And we mutually decided that it was best last year to separate. And we have two children and the business that we were both running together full time. and all of a sudden we find ourselves in a situation where our business is doing really well and growing without us putting a huge amount of effort into it but we are no longer together and that is quite challenging as you can imagine so we do like each other it is not a high conflict separation where we don't talk to each other we have a very nice arrangement in place for the children but the business is a little bit more tricky which is why I came to you guys.

5:05And without getting into too many details, the reason for separation was not business related. No. Would you say on a day-to-day basis that you guys are good business partners? I think it's actually one of the few areas where we function quite well. He's primarily on the tools, which means he's the head mechanic and I'm the business side of things. We both tend And to stay in our lanes, it is not perfect. Obviously, if we had a more solid partnership, you know, sort of romantic partnership or friendship, it would be more smooth sailing. So I think we've sort of reached the peak of the high conflict where, you know, everything kind of exploded with, oh my God, this marriage is over.

5:51So that's a whole challenge in itself. It's really harrowing and it takes an emotional toll. But the business really, interestingly, has just kept running. And not only has it kept running, it's succeeding and it's improving. Our systems and processes are improving. We are getting more mechanics on board. We're looking at expanding into other states in Australia, getting more vehicles on the road. We've formed partnerships with some really, really key players in the industry. Nicole, let me ask you a version of the question that I just asked you with an important difference. I just asked you if you guys are good business partners.

6:36Do you want to be his business partner? Do you want to run the business with him? If I was to be completely honest, I'd say no. I would want to run the business by myself or with someone that I get along with better. I think he would give the same answer that he would want to run the business himself without me in the picture. So you have a situation where the two of you had a very strained, obviously, personal relationship. That strain didn't leak fully into the professional relationship. So it's functional. But now, given your answer, is it fair to say that you're both kind of stuck in this business.

7:16It works. It's great that it works. It's a decent problem to have, all things considered. But it's not your first choice, either of you. But neither knows what to do next. Is that where we're at? Yes. And I think, Jason, adding another layer to that, we've both put in so many years and worked so hard on this business. And being in our 40s, the alternative is to sort of go out and, you know, I come from a marketing background. I'd have to essentially pick up where I left off, which was quite a few years ago, and find a job in the marketing industry, which would be incredibly hard at my age. The advantage of running a business when you have two small children and a skill like my ex-husband has is that it's a very niche market and it offers you flexibility.

8:06but we created the perfect work-life balance for ourselves but we've also diverted from our careers to do this so how do we go back years later and restart a career especially when you're the mother of two children and obviously now a single mother that's another challenge so I feel like, I have no choice. I'm in this. How do I do it well? Well, first of all, Nicole, I'm so sorry you're going through this. I can only imagine how hard it is. Second, are there any agreements in place with the business or contingency agreements? Is there also an option for one of you to buy each other out? How did you set it up?

8:52So the answer is quite simply, no, Nicole, We have no formal agreements in place, not even in regards to the separation of the children. It is not a high conflict separation. We thought we would see where we land with all of this. So we separated only six months ago. No one has approached a lawyer. There are no financial property settlements in place, no custody arrangements. It's really at that stage where I'm questioning, do I keep going with this? and do I build it up and build the value up so that there is something to settle on and there is something to buy? So we're really in that growth phase now where in Australia, it's known as a sole trader.

9:39So we're at that stage now where on paper, the value is growing and it's starting to look like there is something to divide and sell. At what point do one of us approach the other and say, I want to buy you out. Well, let's play out an imaginary scenario. Let's say your ex gets remarried. Does that change the dynamic? Let's say you get remarried. I think it definitely could. We're very much in the early stages of our separation, but the business is hurtling ahead. It's just, it's taking off. So do we wait for those other things to happen and then it becomes ugly down the track? I think you have a conversation about some of those contingency agreements now, if you're going to continue to grow it together.

10:29And I think having children, you have a common goal. You want the best for your children's future. I'm assuming you can both get on board with that mission. And it sounds like your business has the brightest prospects for making that happen right now. So is there a scenario where you can say, let's continue to work together, keep it really professional, and together decide what happens in a lot of scenarios? If, you know, God forbid somebody is incapacitated, God forbid somebody dies, like these are all really hard conversations to have. But I think important to set it up now. So you have a plan for if or when those things happen.

11:15Would that be possible with your ex? I think so. I think, you know, there's a lot of emotions and feelings at play and either one of us could get triggered by the other one. So having these conversations is incredibly difficult, but as you said, Nicole, incredibly necessary. And now is the time to do it. Is there somebody that you work with or on your team that could act almost as a mediator? Yeah. So that's the problem is our team at the moment. They feel really awkward and they almost feel like they have to pick a side and they shouldn't feel that way. The business is still running, still functioning, but I think they feel that something big is coming.

12:01And if that happens, who are we safer with? Are we safer with this partner or this partner? Have you talked to them about that at all? No, we have not because we haven't formed a plan ourselves. So it's the elephant in the room. We keep doing the work. They're huge logistical operations, these bike services in these buildings. So we just kind of go in, we do our things. And every day at the end of the day, I'm just relieved that we got it done and there was no big blow up and there was no high conflict, sort of Gordon Ramsay-esque type of fight between husband and wife. So that doesn't happen.

12:33There's no conflict in front of the staff. But it doesn't matter if there's conflict in front of the staff because there's conflict all over the staff. I'm going to propose at least the starting point for this and then we'll figure out the rest. But what you're telling me now, in a way, sounds like the most dangerous part of this whole thing. That your staff is freaked out and you haven't communicated with them yet. And the reason for that is because your relationship with your ex has already gone through probably the hardest part. And there's a lot more to settle and you guys will figure it out and we'll continue to talk about what your options are with the business.

13:12But the reason why you're in this problem right now is because you have a valuable asset together, which is the business that you've built. And that's all things considered, this is a weird way to say it, but like good problem to have that you have this really useful asset. And now what you need to do is kind of figure out what to do with it and what's going to be best for both parties. But if you don't take care of this asset, it will no longer be a valuable asset. and then you will have an easier time, both of you walking away from a business that's not worth anything, but it will be a blown opportunity in that you have something useful now.

13:49So your staff, even though obviously in your personal life, like your kids are going to take top priority and you have to figure out this complicated relationship with this person, your staff actually takes priority in a way because if you don't at least communicate with them, at least create some kind of plan so that they know that their own livelihoods, because your business supports their lives, that their own livelihoods are not one fight away from disappearing. Their work is going to suffer. Your business is going to suffer. You and your ex are not going to have a business to try to divide up anymore.

14:25So you got to figure that out. You got to do something about that quick. And in a way, that might be easier because in the same way that Nicole podcast host, Nicole just rightly pointed out that you guys have the shared goal of raising healthy children. You also right now have the shared goal of taking care of your employees. And so I would even say to your ex, look, we have a lot to figure out. Obviously, we're going to get there. But step one, I feel like needs to be that our employees are freaking out. And while we figure out what we do, we can't let the business collapse underneath us. So we need to be able to voice something together and come together on something that we can tell everybody so that they're not freaked out.

15:06Yeah, I would think of your business like your other family and those employees being like your other children and coming together for their greater good. I'm assuming you message all of this to your actual children. Well, now it's time for doing the same with your business babies. I think the difference is with little children, you know, there is an element of smoke and mirrors. You can present a world to them that doesn't have conflict. You can create this idea of stability. You know, mommy and daddy still love you. We don't live in the same house anymore. And because our children have meaningful relationships with both me and my ex-husband.

15:45So, you know, in a sense, we've nailed the children aspect of it so far, but with the staff, they know the implications of divorce, of separation. You know, there's a lot of negativity surrounding separation and divorce. and a lot of people don't believe and rightly so, they don't believe that it can end well in any scenario, especially when money is involved and when growing a business is involved. And I think our staff, they smell the instability and they're worried. And how do we come to them as almost a united front and say, you guys have nothing to worry about. We're going to keep growing this business.

16:24When we ourselves face a whole manner of conflicts with regards to certain business decisions. It's a really tricky one. I wouldn't even know how to approach it. My staff and say, don't worry, you guys will be okay when I myself am not sure if we're going to be okay. I could take a stab at it. I mean, look, let's just be clear. This is a hard situation. No super easy answers. There's no straightforward path, but you're going to have to carve some kind of path. So let's imagine what it could be. So you're right. Adult staff members are very different from the children that you're also having to create some stability for.

17:04But you know what? There's a benefit to your staff being adults who are not going to, who are going to see right through smoke and mirrors, which is that you don't need to give them smoke and mirrors. They're adults. What do they care most about? I'll tell you what they care most about. what they care most about is making sure that they can bring money home and put food on their table for their families. So I would bet that if you sat down with your ex and said, all right, what are the three things that our staff cares about that we need to tell them and not BS them, because we're going to need to answer their questions too.

17:41But what can we tell them? Here are some things that we can tell them. We can tell them we're not shutting the business down. Right now, to be honest with you, if I'm speaking as you to your team, I can't tell you right now, a year from now, if this business is owned by both of us or one of us. And if it's one of us, which one of us, we don't know the answers to that yet. But what I can tell you is that we're both very committed to make sure that this business continues to run and that you continue to have jobs. And how are we going to get there? Well, we are actively crafting that plan right now.

18:16and we're going to keep you posted on it. Obviously, this is complicated and it's very personal, but I want you to know that our top priority is that one way or another, this business survives and grows because what we have built here together, all of us is a tremendous thing. And we value you. And we don't want you to feel like we have forgotten that in the cloud of all this. I think that you need to come up with a couple of things that you can tell them that both you and your ex can agree upon, even if the thing that you're telling them is not some polished plan, but you're telling them something.

18:52And also, you're going to need to answer their questions. Because if you walk into a room, I can imagine it, two of you walk into a room, you're like, everyone, don't worry, we got it all figured out. Not taking any questions. Thanks for your time. And you leave like, that's not going to, nobody's going to stick around for that. So you're going to need to have an open dialogue with them. And I will tell you, I've talked to a lot of leaders who have navigated a lot of very hard situations. And they all tell me, all of them, that the most important thing that they did was create open lines of communication.

19:25That nobody expected for them to have all the answers. Nobody expected them to say, everything here is perfect. What their teams did expect from them was acknowledgement, acknowledgement of challenges, acknowledgement of uneasiness. To say, I see that something is wrong here and I am dedicating myself to fixing it. Can't exactly tell you how that's going to happen right now. But I know that I'm dedicated to it. And I know that I'm dedicated to having you around to help with it. And I think that like as a starting point, you guys need to get there. And then the next steps can follow. Yeah, I think from their perspective, whatever they're imagining in their minds is probably worse than the reality.

20:10You know, we often suffer more in imagination than in reality. And I'm assuming that's what's going on in the heads of your employees. And you said something very interesting that you're just trying to get through the day right now. And so it sounds like you're just not drowning, but you're not swimming. And so there comes a point where that transition needs to happen because you are swimming and you are swimming along quite nicely. But you can see that there are some landmines going on right now. So I think the first step is to connect with your ex about what the messaging is for the employees and what you can agree to be true.

20:52And what perhaps you can agree to be true is that there will be a business despite the ownership. Unless you're telling us, no, we want to sell the business. In which case, then I wouldn't tell them there is going to be a business, but we're not sure about the ownership structure. I think we're definitely going to continue on with the business for the next year. And it's not the intention to sell it at all. Because we're on the verge of growing, I don't think we could jump ship right now. There would be nothing to sell. But it does involve this decision around growth. it will involve us spending a lot of money and investing a lot of our time a lot of the money that we've already made that's a huge decision to make I think for any business when they're facing growth do we or don't we is it the right time everyone thinks it's crazy for me to be continuing with this business at this stage they said just walk away now but it's so tempting It's so enticing, the idea of expanding and it's ready to go.

21:57Yeah. I mean, you can, in theory, co-parent a business. Jason, you had an interview with The Rock, right? And his ex-wife that did this quite successfully or do this quite successfully. Yeah, you're right. I mean, I was going to bring this up at some point. For those who don't know, The Rock, Dwayne Johnson, and his first wife, Danny Garcia, they got divorced right around the same time that Danny became his manager. She was in finance and he was not happy with his management. And they decided that, you know, I think they thought Danny could just do a better job. But as they made that decision, their marriage was falling apart.

22:40And they realized that they were actually very good in business together, even though they were not great personally together. And we didn't talk details about that too much, but they did tell me that it felt like a logic decision to them where they could see how working together in one way was going to be really valuable. And I don't know these folks well enough to know how exactly they got there, but I will tell you that they got there because they've built this thriving thing together and now they're both remarried and they seem very comfortable with each other. So I think that it is possible if you want it.

23:18And that's the reason why, Nicole, at the very, very beginning, I asked you in that way of whether or not you want this. Right now, you don't. And maybe you never will want to run this business with him. And that's fine. That's a decision to make. What I would suggest you at least block out, though, is everyone thinks it's crazy that we're going to run this business together. Or because the marriage has fallen apart, we clearly cannot run this business together. I kind of think based on podcast, Nicole, and I do not know you, Australian Nicole, outside of this conversation, but what you're telling us sounds like on the good side of how divorces go, right?

23:58In that there's open communication, you're able to interact without yelling at each other. There's clearly some stuff to build from here. And maybe it is that once the shock of the personal trauma and loss wears out, you have something to work towards together. I'm not advocating for one side or the other, but I am advocating for you to at least consider that there are a lot of options here and that you can step towards them. That's why I really like starting with the team. Stabilize the team and then figure out what your next steps are, but making sure that both of you are communicating with each other, you and your ex on a business terms of where you are and what your aspirations are.

24:42stick around help wanted we'll be right back

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25:37Welcome back to Help Wanted. Let's get to it. Would it be a good idea to get someone in to manage the both of us? Yes, I was going to suggest that too. Because that's my role at the moment. So I'm the general manager of the business. Would it be worthwhile to get someone to... I don't know what the role would be called. So that's what I was going to ask. What is your org structure right now? What are your titles? What does it look like? So as I said, he's on the tools. So he's the head mechanic. So he is the team leader on the job. I coordinate everything from a business perspective. So partnerships, logistics, I'd call myself the general manager, it's head of operations, but I'd say I manage everything.

26:24The rest of our staff are purely mechanics. They're bike mechanics. No one has any other role. Yeah, we have our bookkeeper, like our accounting team, but pretty much I sit at the top and then my ex-husband is out there on the ground leading the teams. What's happened recently is because, you know, he's gone through a really rough time with the separation. They seem to be skipping him and coming straight to me when they have any issues or any logistic problems that they need solved, any questions. They used to go through him. And now it seems to be happening that they're skipping him because he's sort of not really present.

27:01So he's present on the job, but, you know, he's going through a rough time as am I. I think I just can leave that all behind when I come to work. I think that thinking about this from an org structure perspective could be really useful. And I'll say why in a second. But I also just want to acknowledge that because he's not on the call, we're making some assumptions. Maybe you know the answer, but maybe he definitely doesn't want to be running this business with you or doesn't feel like he can or something like, you know, we don't No, just operating under this assumption that he is thinking roughly the same way that you are, but I guess we don't know that.