these friends want compensation for their work, I have told them
that I can't afford to pay salaries, and they say they would rather
have a % of the corporation, i.e. take a percentage of the profits.
What is the customary way of deciding how much they get, and do
they get a
Best of luck.
There is a saying, that if you go into business with a friend, you
will either lose the business, or lose the friend. Sometimes both.
INC. magazine had an article about partnerships that stressed THE
most important part of forming a partnership is to plan for the
dissolution of it.
If later, someone wants out, what is the procedure? Can they sell
their ownership to anyone? or just the partners? Which partner?
Two friends started a business together. One friend was soon calling
it “that damn business.”
They recently went out of business, the one quoted above taking a
financial hit to get out. They are still freinds, largely because she
was willing to take the hit to get out and still be friends.
Anyway, SCORE can help you, make an appointment. Also there is a
Women’s Small Business Development Center.
Check the SBA website for links to all and lots of good reading.
Plan for success, but also know what you would do in a failure. Think
of it as a pre-nup.
If I were in your shoes, I would find a way to pay my friends while
retaining full ownership of my company. Even if I had to borrow money
to do it.
Recent article in INC., maybe the current issue about Switch, the
drink. The inventor and his friend went into business together, and
later the friend forces the inventor out of the business! Then later
the board forces the friend out!
Make sure you know what you’re giving up before you give away parts
of your business.
(Who is sorry to be such a downer)
Metalsmith, Certified PMC Instructor
Hard to Find Tools for Metal Clay