- YEC Member Spotlight: Brendon Schenecker, Founder of Travel Vegas Young Entrepreneur Council
Should I become a business partner or leave the project?
A friend of mine is in a process of starting a new business (Barbershop) he is depending on me literally for everything from discussing the idea and starting up process to marketing and expanding it. He also depends on me to look after the legal issues involved in the process, in return, he promised that he will teach me how to cut hair and will give me a seat in the shop.
However, as I have a good business and legal knowledge, also I am in a reasonably good financial position to become a prtner, I felt like I should be a business partner rather than just a potential employee in the shop. I proposed this once and he wasn’t happy about it.
So, what do you think I should do? Ask him again and if he didn’t agree then leave him to it? Or just carry on helping him with a hope that he may be honest in the end?
Your opinions are much appreciated.. Thank you
If his capital and credit will finance the startup, he has every right to full ownership (along with full responsibility for the leases, licenses, debts, liabilities, etc). If you are contributing or "loaning" a significant part of the capital, you have every right to ownership, proportionate to your financial participation.
If your friend wants you to do all the legwork, and in return wants to offer you a job, you may well decide to pass. Risk vs reward are all out of balance.
If you get offered a partnership at the start, think carefully -- your startup money is at great risk, your signature on the docs equals liability, most business failures happen in the first year.
Source(s):11 months ago
A troubling statement, "Or just carry on helping him with a hope that he may be honest in the end?"
That implies you're concerned about dishonesty now.
I can't imagine why you would give up an apparently successful career involving business and legal for a chair in a barber shop whether you were a partner or not. Nothing against barbers, but that would seem to be a step backwards.
Fifteen years ago my best friend was starting up a new business and needed business and other assistance, which I provided because he's my friend. As things dragged on, he needed - guess what - money. I "loaned" him enough to make it hurt on two occasions, with the agreement with myself I wouldn't lose the friendship if he didn't pay me back. I then told him I had to back out completely. Now, fifteen years later, we're still friends and he's still trying to get that damn business off the ground. I'm sure glad I didn't go further down that path than I did.
Unless you do become a partner, he's going to have to learn to walk on his own two feet eventually.
I would have nothing to do with the idea except as a paid consultant.
You may have no aptitude for being a barber at all.
Do you actually want to be a barber?
If he is only giving you a seat in the shop you will not even be an employee. That just means you may have your own clients in your seat. If you get no clients you have no income.
With your business skills surely you will be much better off staying in your present line of work.