Silent Partner Vs Secret Partner: Which Is More Beneficial

There are many ways an individual can become a partner in a business. However, many don’t understand between Silent Partner Vs Secret Partner, Which Is More Beneficial. A lot of people like to play the part of a silent/secret partner in a business partnership because it is more favorable to them. A business partner can contribute his/her own money, contacts, and expertise to a growing or new business.

A business partnership comes in different forms. You may get an equal partner who’s committed in terms of the amount of money he contributes or the amount of time and effort he puts into the business. An active partner, on the other hand, contributes a huge share of investment and reaps a bigger portion of the profits than an equal partner.

Silent Partner Vs Secret Partner

The two main categories of a business partnership are the Secret partner and the Silent partner. Let’s now quickly look at the difference between these two partnerships:

Secret Partner

A secret partner in a business partnership is a partner who has a say in the business’ operations but still operates behind the scenes. The public is unaware of his/her involvement with the business in any way.

He/she may have been involved in a previous business failure and for that, wouldn’t want her name or reputation linked with the new business. A secret partner is satisfied to have the owner of the business be the “face” of the business, while he operates behind the scenes.

Silent Partner

A silent partner is just an ordinary investor in a business, that contributes to the business but has no say or makes any other contribution other than money in the business’s daily activities. He is silent when it comes to dictating how the business is run.

A silent partner is recognized by other people to be in partnership with the business owner. Oftentimes a silent partner’s business contacts, involvement, or reputation can be favorable to the business and help strengthen its image in the community.


Except the business operates under another business partnership (limited partnership), then both the silent and secret partners share in the responsibility of the business. A limited partnership agreement reduces the burden of the partners in cases of a lawsuit or debt.

And If the partnership is unorganized, each partner can be subjected to damages for unlimited liability. So even though secret partners are not always known in the business, they too can obtain liability.


Sometimes, people use and take the terms “silent partner” or “secret partner” to mean the same kind of partnership. Some theory doesn’t help in differentiating the two partnerships, stating that a secret partner is not recognized by the public – in other words, a silent partner can also be a secret partner.

The difference between Silent Partner Vs Secret Partner so far is in if the partner has a say in the business’ daily activities; which we already established that a silent partner never does, and a secret partner may.

Leave a Comment