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Although there are many advantages of solo practices, including total autonomy and not having to compromise in the practice's decisions or share in its successes, for me the disadvantages were much greater.
Another advantage I had was that I knew my future partner both personally and professionally as we had worked closely in the same practice together for 4 years. We got along well, had complementary personalities, and similar practice styles. I have seen a few best friends and family members start a business together with disastrous outcomes. So just like a marriage, it is vital to make sure you are compatible with your partner(s). Another key point is to make sure all is in black and white before the doors open. We hired an attorney to compose partnership agreement contracts for both of us. Equal profit distribution versus pay for productivity, paid maternity, disability, vacation time, and even partnership buy-out if one of us decided to leave or retire early were all discussed and agreed upon beforehand. Ignoring these details is a critical error many new practices make and may cause hurt feelings or even bitter legal battles.
Finding additional partners
OUR BANKER SUGGESTED taking a risk with the then booming housing market and financing the practice with home equity loans. Although this method is risky (since it can lead to homelessness if the practice fails) and certainly depends upon the housing market situation in one's area, it turned out to be quite a boon for us, since the loan to ourselves was tax deductible. Since it was quite literally our money, it was also used most resourcefully and was repaid more quickly. Specifically, we invested approximately $60,000 each to start the practice and this amount was repaid to us in 6 months, meaning that we did not have a paycheck for half of our new practice's first year. Our consultant predicted this beforehand and we thankfully saved up and supplemented our income by moonlighting at our local hospital during those initial lean months. This prediction also made it financially prohibitive for a potential third partner and thus saved her and us many headaches down the road.