Client is offering investment in company instead of payment? Is this normal

My gut says no.. I just haven't come across this.

The fact that it's a start up (although he is a bit of an entrepreneur so he has experience) makes my brain scream no.

I'm a little stumped though, as it seems like a few of the other people involved in this project must have agreed to it.

Bizarre.

Whilst I fully agree with your comments, NEVER underestimate the selling power of a farting app!

Yeah, I don't know though, if it WAS such a lucrative possibility why would he be offering it out to people, wouldn't he want to keep his cards close to his chest.

I do need the money, as I am trying to grow my business and save and I'm just not in a position to accept part payment as equity, I mainly just wondered if this is the 'done' thing.

I am sure there are plenty of legal things to consider. I just haven't come across it.

I have made a decision that if I was interested in his business, I would buy into it and not work with him just to ensure that if something goes pear shaped there is not bad blood.

I know this guy is a bit of an entreprenuer and he drives around in flashy cars and looks to live the high life but I also know nothing is always as it seems.. and for all I know he could be doing that on credit card.

Yeah, this was my immediate thought too - why would you want to give parts of your possibly lucrative business away... weird.

I know the roll out phase is going to be expensive for him, there is a lot to set up and it involves training people and a whole lot more than a standard app (I wish I could share what he is doing but it is still protected by NDA)

As far as giving pieces away in the early stages, it just seems to me like something could go wrong. How would I really know how the business is being managed anyway if I am not an equal partner. It's all just alot of what if's really. I won't be doing it, and I will steer clear of working with him further if this is a deal breaker for him.

Just a really bizarre request I thought.

Hi Kay,

Yes I have been working on things for him for about 6 weeks, he has paid one invoice already and agreed to the next month worth of work.

He just keeps mentioning he would like to come to an arrangement in the future that could be mutually beneficial.

It totally sounds like a dodgy sales pitch to me.

I rely on the physical income, not the possibly income which could happen, all going well - there are just too many unknowns and Im not really keen to risk anything like that when I am not in control.

The quote is for each month with tasks outlined for the marketing and strategy development for the app. He does pay, but thats the other thing he pays with a credit card (which isnt big deal) but sometimes I worry that if youre paying on credit do you have access to funds silly probably.

He hasnt raised it again this week, but I have spoken to my partner and its going to be a flat no. He will get invoices from me and I wont accept a cut in the business. While its at this stage there are just too many unknowns.

I genuinely havent had someone request this below, sure Ive done contra before with people in the industry which works well but not with clients and not like this.

It just stumped me.

Agreed - and I will work with him again however he will need to pay me for all the work I do.

Actually, you do know, because the ability is there to weigh up decisions based on current data and success of said random entrepreneur/investor.

But having said that i agree on this case. Make him pay what he owns you.

Good to know this worked for you, seems like a good arrangement. You arrangement would certainly pay off the work you did so in this instance it's a good call.

I think that for the app, while it's a brilliant idea, the set up costs are huge and there is a part of me that worries he won't be able to cover it all, which means it could be a flop.

While the concept is a winner (I would definately use it and know plenty of people that would too) it's whether it will get off the ground that worries me and I am not in a position to outlay hours and hours of my time for that.

Like someone on here said as well, when you become a partner it seems like there is a whole lot of extra time that is spent planning and working things out as well as the marketing I would be doing, and right now I am just not able to forgo the other hours I should be giving to other projects.

I hope to be able to do this in the future, but I think I would want more control from the start and not be brought in half way when there has already been so much done.

I don't know where you're from but where I'm at the electric bill will get payed or they shut you down.

Businesses, pfff.