The Essence of Limited Partnership
If you think that marriage was a difficult relationship to enter into and maintain, you have obviously not experienced the turbulent waters of a business relationship. Imitators soon followed, and at this point, there is no shortage of websites that will help the aspiring entrepreneur to hook up and partner up with others who will be able to get a business up and to grow.
Caution is still needed, and just like dating websites will seek to match you up with the potential spouse of your dreams, a failure to be open and a lack of a good dose of common sense can still set you up for failure. Your potential business partners should have a skill set and also relevant work or business experience that complements you and your business since enthusiasm is not enough to make the cut. Just as important as the hard skills are the soft skills.
Age works two ways. While it is tempting to hook up with a business partner who is of similar age as you, do not limit yourself. A younger person will bring an enthusiasm and zest to your business which you might be lacking although you might not know it while an older individual will bring life experience and quite possibly also years of business acumen which you simply have not been able to have. There are different kinds of business set ups.
A limited partnership is a type of partnership that have ore or less similarities to a general partnership, but the difference is that a general partnership should have two general partners, and a single limited partnership should have one general partner and one limited partner.
In all primary respects, general partners hp in similar position as great partners in a company, especially when they have a management control, some unique share of the right to use the partnership property, solidary liability for the debts of such partnership, and share the profits at predefined parts.As in a general partnership, the general partners have an authority, as the agents of the company, to bind the contracts in partnership with the third parties that are in the typical course of the business of the partnership.
Defining limited partnership
Like shareholders in a certain corporation, the limited partners in a limited partnership also have limited liability. In other words, the limited partners have zero management authority, and are not liable for the debts of such partnership (unless they have obligated themselves by another contract such as the guaranty). The limited partnership delivers the limited partners some good return on their investments (the same goes to a dividend), and the extent and nature of which is typically defined in partnership agreement. General Partners will tend to bear more economic risk compared to the limited partners, and if there is great financial loss, the general partners will be the ones liable.
Limited partnership are subject to the same kind of alter-ego piercing principles since corporate shareholders.