Whole it's possible for this arrangement to work (we did it successfully from 1996 to 2016) I still don't recommend it. Firstly it takes enormous good-faith by

Whole it's possible for this arrangement to work (we did it successfully from 1996 to 2016) I still don't recommend it. Firstly it takes enormous good-faith by both parties. It worked for us because our partner was very ethical (as are we) and both sides managed to work well together. There were however several inefficiencies. They decided to sell the business and found no buyers (because nobody sane buys a business with one supplier. ) we couldn't preemptively lock in a long term contract until we knew who the buyer would be. We met a couple of the prospects but it takes time to build a new relationship. In the end we acquired them at the agreed value. Since then we've uncovered all the places where being 2 companies created massive inefficiency, and incompatible goals. The sum has been worth more than the parts. All that said, yes the model worked for us. Yes we didn't have the capital to do "their side" of the work back in the 90s. So having it in-house would have been difficult. Since we had very different management styles (also apparent after the merger either company culture) we wouldn't have been good co-founders. BUT all that aside, the model also held us both back quite a bit, which we've Since come to realise. It also succeeded mostly because (like a marriage) we both were willing to make allowances and operated in good faith. And both sides were "good character". So I'm not saying it can't work. I'm saying it's risky, and not a model I'd recommend.