Why You Should Do Business With Your Neighbors and Friends

Aug 30, 2013 - Joe Matar

A lot of conventional wisdom out there says, "Never do business with your friends” or "Don't mix work and pleasure."

The idea is that we should keep our work and social lives separate. We wouldn't want to get into a financial dispute with our neighbor or see a friendship end over a business deal.

But wait a minute. Does that mean we should never look for work that integrates us with our community? That we should never blur the line between work and fun?

Sure, there are good reasons not to go into business with people you're close with. Long-term business relationships are tough, and I've had my share of strained friendships because of them. But simply exchanging goods and services? Why not?

Doing business with friends is not a new concept

Back in the old days, everyone did business with their friends and neighbors. Those were the only people around you could do business with. Financial interactions were built on trust. Stores extended lines of credit to their customers.

Only recently have we been able to put corporations between us, to use credit cards instead of personal trust. We can use a customer service representative as a buffer to avoid directly confronting the people we disagree with.

When we do offer help to our friends—say, to build a website or record an album—we do it for free or for a token beer.

It would cheapen the friendship if money changed hands, right? Not at all.

I live in a community in LA full of artists and freelancers. There are graphic designers, Web coders, videographers, musicians, massage therapists, yoga instructors.

Sometimes our needs line up exactly and we can trade website help for guitar instruction or a yoga lesson. Other times, we exchange money.

Most of us would be out of business if some of our clients weren't also our friends.

Accepting payment from friends for your work

When I first started teaching yoga, it felt weird to ask my friends and neighbors to pay for a lesson. I enjoyed it, so it wasn't work, right?

But then I remembered I’d invested money in a teacher training program. I had set aside several weekends to learn the skills I was teaching them.

Charging money for lessons wasn’t a way to make a quick buck off of my friends. It was what enabled me to set aside the time and energy to teach them in the first place.

We're so used to money being a tool to make us do something we don't want to do. Why shouldn't it be a reward for doing what we love?

When I “hire” one of my friends to do Web or graphic design, it means I value their skills enough to pay them fairly. It means they can spend a day working from home and devoting themselves to my project, instead of going off to work a “real” job.

Putting the share economy to work for you

The more we can build up local economies within our neighborhoods, the less we have to go to work out there. Money enables us to continue doing what we love doing.

That's why I'm such a fan of the share economy and the peer-to-peer marketplace. Sites like Airbnb, Taskrabbit, Lyft, Zaarly and Vayable connect people for short-term jobs, rentals, lessons, classes and other one-on-one interactions.

It's a way to bring our economies back to the village green where people can exchange goods and services directly, without the middleman.

We can regain some of the trust that we lost in the era of big business and extend it, not just to our friends and neighbors, but across the world.

We can maintain relationships across borders by vouching for our friends or introducing them to long-distance acquaintances.

When your reputation hinges not just on your credit score, but on references left by mutual friends and members of your community, the social Web becomes more intertwined. And that's what an economy should be, right? A circle of exchange that benefits us all—not just the businesses and corporations at the upper end of society.

Exchanging debt as a part of a healthy society

In his book Debt, David Graeber writes about a rural community in Nigeria where women "spend a good part of the day walking for miles to distant homesteads to return a handful of okra or a tiny bit of change, 'in an endless circle of gifts to which no one ever handed over the precise value of the object last received'—and in doing so, they were continually creating their society… This sort of neighborliness had to be constantly created and maintained."

Something about this description speaks to me. It sees debt not as something we should be ashamed of, but as a healthy part of a functioning society. It sees exchange as a way of facilitating friendships, not stifling them.

In my neighborhood, we have a nightly meal plan, where for $40 per month, you can stop by one of our intentional communities and share dinner with the rest of the house. Once or twice per month, it's your turn to cook and clean.

Is it a bit awkward for the facilitators to ask for money at the beginning of each month? Sure. Do people forget to pay or sometimes have to be chased down for payment? That, too.

But the exchange of paper at the beginning of each month is what enables the rest of the meal plan to function. It allows everyone to interact freely, without worrying who is or isn't pulling their weight. It creates a continuous cycle of give and take.

Saul of Hearts is a writer, musician, videographer and yoga instructor based in LA. His book, The Lateral Freelancer: How to Make A Living in the Share Economy, looks at ways of using peer-to-peer websites to create multiple income streams.