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I have new app idea

by sdlive
17 replies
My cuzin wants to pay for app development which costs $1-3k to develop.

He will own 30%. 70% for me.

so here is a quick rundown

Phase 1
1. he will pay 1-3k to develop app

Phase 2
1. If app proves to be success, he will cover ALL COST (dedicated hosting, hiring of programmers, renting office space, etc etc)

Phase 3..
My concern is, WHAT IF HE can't afford to fund me anymore? what happens to his 30%?
#app #idea
  • Profile picture of the author Jonathan Register
    If you give him 30% ownership...then he keeps that. :-) Even if he can fund you further or not. But you own 70%, so....if it's a success then I'm assuming there's some type of monetization built into the app (so you'll be making money).

    Just take whatever money you make and re-invest back into the business. There's always a way...just git r' done! :-)
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  • Profile picture of the author sdlive
    would you say 30% is too much?
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    • Profile picture of the author khut
      Are you creating the app?
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      • Profile picture of the author sdlive
        Originally Posted by khut View Post

        Are you creating the app?
        yes, ill be doing UI/UX, designing... getting it coded, and managing it. Pretty much until it works. He just funding me.
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  • Profile picture of the author yoangov
    If you get 100% funds, 30% is not much at all. Many "sponsors" will ask you for 51% when they do 100% of the funding.
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  • Profile picture of the author OnlineAddict
    You better have a written contract checked by a lawyer, but even then...making business together with family never ends up well...in one way or another.
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    From1toMillion Forex EA
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  • Profile picture of the author steven8433
    never mix business with family
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  • Profile picture of the author joseph7384
    Originally Posted by sdlive View Post

    My cuzin wants to pay for app development which costs $1-3k to develop.

    He will own 30%. 70% for me.

    so here is a quick rundown

    Phase 1
    1. he will pay 1-3k to develop app

    Phase 2
    1. If app proves to be success, he will cover ALL COST (dedicated hosting, hiring of programmers, renting office space, etc etc)

    Phase 3..
    My concern is, WHAT IF HE can't afford to fund me anymore? what happens to his 30%?

    OK, your cousin is coming up with 1-3k to develop the app, he will be paying for dedicated hosting, he pays the programmers and he is renting the office space all for 30%.

    What will you be doing for your 70%?
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  • Profile picture of the author sdlive
    yes, developing the app. He doesn't have to do anything. he just sits and invests. What u guys think?

    And IF or when the site starts making money. We split tax cost 50/50
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  • Profile picture of the author sdlive
    any other loopholes?
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  • Profile picture of the author Sagar Mehta
    Am not sure about your understanding with your cousin, how well you gel etc, but you should get a lawyer if you are serious about the app.

    He's giving you 70% even though he's funding the whole thing which I guess is really unprecedented. Talk to a lawyer and get at least a basic agreement done.

    Sagar
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    • Profile picture of the author sdlive
      Originally Posted by Sagar Mehta View Post

      Am not sure about your understanding with your cousin, how well you gel etc, but you should get a lawyer if you are serious about the app.

      He's giving you 70% even though he's funding the whole thing which I guess is really unprecedented. Talk to a lawyer and get at least a basic agreement done.

      Sagar
      what do you mean "really unprecedented"
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  • Profile picture of the author Sagar Mehta
    Well, usually, if you read up on tech news like I do (a little too much sometimes lol), most investors will invest in a new app IF they get a good chunk of the ownership (and see potential in the app).

    30% is quite low for taking all the monetary risk in an app which may or may not work out. But if you're getting a good deal, that's great for you :-)

    Sagar
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  • Profile picture of the author Moneymaker2012
    Hello,
    If you want to make lifetime relation with your cousin then never do business with your family and relatives because Money is very bad things between relationship.
    Hope You don't mind but this is my personal experience.
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    • Profile picture of the author sdlive
      Originally Posted by Moneymaker2012 View Post

      Hello,
      If you want to make lifetime relation with your cousin then never do business with your family and relatives because Money is very bad things between relationship.
      Hope You don't mind but this is my personal experience.
      Thanks, ill keep this in mind
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  • Profile picture of the author digitalsapien
    First things first. Write everything in a piece of paper what ever your agreements are. Just to be sure you know.
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