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Business Partnetship Terms?

by Tom Brimeyer
3 replies
This question is for anyone with business partnership experience.

Long story short...

I'm partnering with an offline expert in a particular niche. The idea is to use him to help create the expert content. He won't be doing it all himself, it will be a joint effort with both of our names. But I'll pretty much take care of everything outside the content... filming, editing, etc + pretty much the entire online business. We continue to create content/products and he just gets a paycheck.

I'm stuck as to where to split the business between us. 50/50, 70/30?

It's pretty obvious in this business that creating products is the easy part. It's the marketing of those products that takes the most work.

Any have a similar experience and care to share the results and split?

I'd like to have something tangible to work with before we meet with the lawyer.

I also plan on helping him build his offline business as well but I plan on keeping the online & offline businesses separate.

Cheers!
#business #partnetship #terms
  • Profile picture of the author cnrimgr1
    If it is a joint effort why not 50/50. However creating a product is not necessarily a piece of cake compared. I actually take longer to create a product then I do to get it to rank #1. It depends on your skills, your niche, your keywords, the competition of those same keywords, and the uniqueness of product, and what all the product is offering.

    A simple ebook is easier than to add audios, etc. Why not gauge how much of the work you feel you would be doing and offer that percentage. Also make sure everything is in writing. I am getting ready to part ways with my business partner because now she does nothing while I literally work 12+ days on the business. Still she collects 50% of the sales and hasn't promoted the site in about 3 months of the last year or more.
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  • Profile picture of the author Jack Duncan
    Tom,
    This is a tough question to have a "right" answer to.

    What I've done in the past is sit down and come up with a conservative budget for the first year...and then figure out what % you would be responsible for and what % the other party would be responsible for.

    So, in this case, let's say that this individual feels their expertise is worth $250 per hour...and it will take them 100 hours to produce the content.

    Let's say on your part that your budget for filming, editing, publishing, marketing, etc. is $50,000.

    In this hypothetical scenario, he has roughly $25,000 risked and you have $50,000...or 67%...

    Obviously, this is a very simplified example...but I think you get the point.

    If you can figure out what the budget will be and then decide what % of that budget you have risked vs. the other party...then I think you have at least a place to start with...

    Of course, there are 1,000 more possible variables in your case that may make this more complicated...

    All the best on your project,
    Jack Duncan
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  • Profile picture of the author Miles Kral
    it all comes down to negotiations, start with what your expenses will be vs. his expenses in time and other resources, that will give you a starting point. If you can't agree on a percentage split than you have to find other points to negotiate like responsibilities and level of contribution. Just keep working on it until you find a common ground you can both live with. But I would have to have everything worked out before I meet with the attorney, someone has to pay him so why waste the attorneys time negotiating.
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