A partnership is a type of business where two or more people share ownership, responsibilities, and profits. It’s like starting a business with a friend or colleague—each person brings something to the table, whether it’s money, skills, or ideas, and together you run the business.

Imagine you love baking, and your friend is great with numbers. You decide to open a bakery together. You handle the kitchen, and your friend manages the finances. That’s a classic example of a partnership.

There are a few types of partnerships:

1. General Partnership: All partners share equal responsibility for managing the business and are personally liable for any debts.
2. Limited Partnership (LP): One or more partners manage the business, while others contribute money but have limited involvement and liability.
3. Limited Liability Partnership (LLP): Common among professionals like lawyers or accountants, this structure protects each partner from the others’ mistakes or debts.

In a partnership, profits and losses are typically split according to the agreement made at the start—called a partnership agreement. This agreement lays out who does what, how profits are shared, and what happens if someone wants to leave.

The main benefit of a partnership is shared effort and resources. You’re not doing it all alone. But, it also means shared risk. If the business goes into debt or gets sued, all general partners may be personally responsible.

Partnerships are great for people who trust each other and want to build something together. As the business world gets more collaborative, partnerships offer a flexible and balanced way to grow with the support of others.