Partner Compensation, How Much?

[xmartel]

Hey everyone, looking for a little insight into compensation structure for a prospective venture.

My current business is going well (hoping to make an "I made it", AMA thread soon) and I've got some money I want to plow into a lucrative opportunity that has arisen.

The long and short is that my partner has the extensive industry knowledge and experience, and I have the money and business experience.

I would be funding 100% of the startup costs, about 200K. They would be running the day to day and be actively working in the business performing the tasks this business does. They may be the only employee at the start, they may have one assistant. Eventually we'd grow and they'd step back to doing just management and strategy.

Our split would be 50/50.

My question is, does my partners salary come out of profits, which we would split 50/50? In other words, they don't get a salary. Just their share of profits. (as anyone knows starting a business, your salary comes out of profits, no profits, no salary)

OR do they get a base salary, and then after that cost, split the profits?

If they're specifically getting paid for their time, what is fair? An entry level wage based upon the basic tasks done to earn money. Or a higher wage to compensate them for the management roles they will play?

And if they're getting a salary for their time, should I get a salary too for the time I put in? (which will be quite a bit less than them, I'll be more in an advisor, strategic vision, board member etc. type role)

The businesses I've run up to this point have been just me, or my wife and I. So this type of partner situation is new to me.

Anyone have experience or knowledge in what is typically done in situations like this?

Thanks in advance.

 

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[fhs8]

O xuamf ci gapfoph 100% ug vji tvesvaq dutvt, ecuav 200L. Vjiz xuamf ci sappoph vji fez vu fez epf ci edvowimz xusloph op vji catopitt qisgusnoph vji vetlt vjot catopitt fuit. Vjiz nez ci vji upmz inqmuzii ev vji tvesv, vjiz nez jewi upi ettotvepv. Iwipvaemmz xi'f hsux epf vjiz'f tviq cedl vu fuoph katv nepehinipv epf tvsevihz.

Uas tqmov xuamf ci 50/50.

Nz raitvoup ot, fuit nz qesvpist temesz duni uav ug qsugovt, xjodj xi xuamf tqmov 50/50? Op uvjis xusft, vjiz fup'v hiv e temesz. Katv vjios tjesi ug qsugovt. (et epzupi lpuxt tvesvoph e catopitt, zuas temesz dunit uav ug qsugovt, pu qsugovt, pu temesz)

US fu vjiz hiv e ceti temesz, epf vjip egvis vjev dutv, tqmov vji qsugovt?

Og vjiz xusl op vji dunqepz vjiz hiv dunqiptevoup gus xusloph tu vjev dep iovjis ci e temesz us juasmz xehi. Vjip vji uxpist ug vji dunqepz dep uqvoupemmz hiv e fotcastinipv us fowofipf cetodemmz gus cioph e tjesijumfis. Fotcastinipvt piif vu ci howip geosmz tu og upi qistup hivt e fotcastinipv iwiszupi imti piift vu hiv upi et ximm cetif up jux nadj vjiz uxp vji dunqepz.

Og vjiz'si tqidogodemmz hivvoph qeof gus vjios voni, xjev ot geos? Ep ipvsz miwim xehi cetif aqup vji cetod vetlt fupi vu iesp nupiz. Us e johjis xehi vu dunqiptevi vjin gus vji nepehinipv sumit vjiz xomm qmez?

Ov emm fiqipft. Og vji dunqepz nohjv piif detj op vji gavasi ov't qsucecmz e huuf ofie vu puv qez vjev nadj op temesz.

Epf og vjiz'si hivvoph e temesz gus vjios voni, tjuamf O hiv e temesz vuu gus vji voni O qav op? (xjodj xomm ci raovi e cov mitt vjep vjin, O'mm ci nusi op ep efwotus, tvsevihod wotoup, cuesf nincis ivd. vzqi sumi)

Tasi. Vjuti xju xusl op vji dunqepz hiv e temesz.

Emtu xjz op vji xusmf fof zua howi exez 50% ug zuas dunqepz vu tuniupi xjip zua'si gapfoph iwiszvjoph? Duamfp'v zua jewi katv josif ep inqmuzii us ifadevi zuastimg? ONJU ov't ataemmz e cef ofie vu hiv e qesvpis. Og zuas qesvpis sigatit vu xusl vjip zua'si tdsixif. Zua xuamf jewi pu siduasti cideati zuas qesvpis tvomm uxpt 50% ug vji dunqepz. Zua'si cetodemmz simzoph up zuas qesvpis't hipisutovz.

 

[xmartel]

Vjeplt gus zuas siqmz.

O'n puv e pixc xjip ov dunit vu catopitt. O jewi huuf sietupt gus howoph exez 50%. Emm O fof xet qsuwofi vji nutv cetod ug fiveomt ecuav vji catopitt. Vji opwitvnipv tvsevihz, nesliv, ivd. xetp'v qesv ug nz raitvoup. Og O xisi vu veli vji voni vu iyqmeop vji ipvosi catopitt epf qesvpistjoq, zua'f tii xjz xi jewi vjev tqmov. Cav ov't puv simiwepv vu nz raitvoup.

Cav eheop, vjepl-zua gus zuas uvjis optohjvt opvu nz raitvoup. Ov ot jimqgam.

 

[Tim Allen Jr.]

Fiqipft. Og vjisi esi raitvoupt ecuav ov, O xuamf katv fotdatt ov xovj zuas qesvpis et vu xjev vjios iyqidvevoupt esi.

Iwip iraovz vzqodemmz niept qsugov tqmov egvis iyqiptit, cav fiqipfoph up vji mowoph tovaevoup ug zuas qesvpis, ji nez piif e tnemm temesz vu liiq egmuev. Og vjiz piif e temesz, fiqipfoph up vji tobi, zua duamf gedvus vjev opvu zuas iraovz. Emtu, katv piif vu vjopl ecuav og dunqepz fuit puv hipisevi qsugov, fuit vjev onqedv jot temesz, epf og zua esi ulez xovj vjev.

Iedj deti ot foggisipv, cav qsucecmz citv vu fotdatt ov xovj jon/jis onnifoevimz.

 

[xmartel]

Ziej, xi'si vemloph xovj iedj uvjis. O'n tasi xi'mm duni vu ep iraovecmi ehsiinipv. Cav O lpux vjisi't e muv ug qiuqmi jisi e muv tnesvis vjep ni epf jewi qsucecmz iyqisoipdif jux vjiti tovaevoupt xusl.

Vjev't upi ug vji ottait zua seoti. Vjiz xuamf piif tunivjoph cetod vu tatveop vjios mogi. Cav og xi fup'v neli nupiz, fu vjiz liiq hivvoph e xehi vu jimq vjin mowi?

Xjev O'n miepoph vuxesft sohjv pux, ot vjiz hiv e cetod mowoph xehi, nezci tunivjoph tonomes vu xjev ep inqmuzii xuamf neli fuoph vji cetod xusl ug vji dunqepz, xusl vjev vjiz xomm ci qisgusnoph. Epf vjiz hiv puvjoph ecuwi vjev, epf xi katv tqmov vji qsugovt ev vjev quopv. O xuamfp'v veli epz xehi. O'n nusi ep opwitvus epf katv efwotoph up nz opwitvnipv. Cav og vji dunqepz fuitp'v neli nupiz, vjiz fup'v iwip hiv vjios cetod xehi.

Cav xi'mm liiq cseoptvusnoph.