New Business Startup

Discussion in 'Starting a Business' started by peterhupuczi, Sep 12, 2014.

  1. peterhupuczi

    peterhupuczi
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    Hi, I'm Peter and i would like to ask few opinion on how we can share the profit of a new startup company.

    So me and a very good friend want to launch a new startup company. I'm a Freelance Web & Graphic designer and my friend is a teacher.

    We want to know the best way how we can share the profit.

    The company will be an e-learning website where students can purchase courses for a fixed price. Something similar like Team Treehouse and Lynda does.

    My friend (the teacher) will put he's Money int the company as a starting capital.

    I can not put in any money, but I will do all the design work for all the course and manage the company website on an ongoing basis.

    He was offering me a 30% share of the company.

    I feel this is not a fair offer, since he has lot less work than I'll have doing all the design work for the courses we plan to sell...

    What do you think about what would be the best way to make a fair deal?

    If you have any questions, to help you understand more of the situation please ask, I'll be happy to answer.

    Thank You!
     
  2. Joseph.Shivell

    Joseph.Shivell
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    I'll start with a couple of questions. Without his money, would you be able to start a company like this on your own? Are you doing anything else, other than designing the courses the company will be selling? There's a lot more to running a company than just spending money, or just putting up a website and waiting for the money to come in. Who is going to take care of the day-to-day running of the company, or hiring of outside firms for things like marketing, accounting, purchasing, etc.? To me, 30% seems more than fair, unless you are doing more than just creating the product that the company sells.
     
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  3. peterhupuczi

    peterhupuczi
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    Hi joeroxx ,

    thanks for the reply...

    I'll answer to your questions.

    1.) Without his money, would you be able to start a company like this on your own?

    Unfortunatley not.

    2.) Are you doing anything else, other than designing the courses the company will be selling?

    I bringing new ideas and, I have some marketing experience as well. I will manage the website I'll help with with putting together the videos. I also do animation for the videos etc and I have to deal all technical related issues.

    3.) Who is going to take care of the day-to-day running of the company, or hiring of outside firms for things like marketing, accounting, purchasing, etc.?

    yes accounting and marketing will be given to third party company. The day to day things we will do it both, and also thinking to hire someone, who will seeking other teachers to create other course material, and setting up meetings with those teachers. On the meetings him and I will explain what we want and how our sites will work etc.

    Keep in mind I'll be designing all the courses on an ongoing basis. At start we plan to start doing a new course in every month for the first year and make it more in the future per month.

    thanks
     
  4. CoolHandCol

    CoolHandCol
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    Based on what you have said, I feel you should get 40%. The responsibilities are similar but your partner is risking the money so should get a higher %
     
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  5. Mark T

    Mark T
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    The solution is to know what your job descriptions and responsibilities are. This could help the 3 of you determine how each of you will gain from your company's overall profit.
    Perhaps, before you start your company, the three of you should plan out and create an agreement, scoping your duties and responsibilities towards the company and the services.

    Regards,
    Mark
     
  6. lukejade

    lukejade
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    If you are not happy, then bring another partner.

    Or get up with this.

    After all, this is more than an employee. Money talks. He is the boss.
     
  7. MikePeterson

    MikePeterson
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    Well it is good that you are deciding to start a new business, but before starting any new business make some strategy so that you can go towards a better path.
     
  8. LeroySimpson

    LeroySimpson
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    Yes, it is but apart from that you must also have to aware all the circumstances and their needs such as if you are having a partnership in business then you should have to make or plan your strategy according to that because just by making a strategy will not build your business, for that you have to also financially balanced. So it is better to make your strategy by looking all the part, in which finance is the basic part for starting your business.
     
  9. lukejade

    lukejade
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    Sorry, I guess it is just two, not three. :)
     
    #9 lukejade, Oct 6, 2014
    Last edited by a moderator: Oct 7, 2014
  10. Valentine

    Valentine
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    Hi Peter, Try bidding for 40 but if it dosen't work out please accept the 30%. This is the way i look at it. You accept 30% now and try to grow your own capital from the proceeds you make from the 30%. When you have acquired enough capital float your own company and watch how it pans out without leaving this company.Then you can try bidding for a higher stake, even as much as 50%-60%. By that time your friend would have agreed you are an invaluable asset to him and would most likely see reason to accept. If he dosen't, you can opt out.
     
  11. TheGrandAdmiral

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    I think that it is reasonable. He might not be designing, but teaching and coming up with the lessons is hard work. He is also coming out of his pocket to finance the endeavor.
     

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