Key questions to ask regarding partnerships

Thinking of forming a business venture with a partner? Here are some key questions to answer BEFORE you get going:

1. How much money will each contribute? (Hint: Both should contribute equally. Avoid sweat equity situations as one partner will become resentful of the other).

2. Is equity ownership equal? (Hint: It is best to have equal ownership to avoid disputes and resentment?

3. What is one partner wants out? (Hint: Penalize a partner for wanting out. Don’t reward him or her. Suggestion: Appraise the enterprise at point one partner wants out. That sets the price. But payment happens within 5 years of that point, at a 10-20% discount to the set price.)

4. What if one partner isn’t holding his/her weight? (Suggestion: Give 30 days to correct, and then set up buyout arrangement similar to #3).

5. What happens if partner dies and has spouse/family? (Suggestion: Let shares pass to spouse, or buy spouse out at market. But spouse has no voting rights, and can only sell his/her share with written approval of other partner).

6. What is initial capital contribution? (Hint: Make it equal, put it in a bank account, and draw ALL expenses out of that account).

7. Once profits appear, do you reinvest or pull money out? (Hint: All partners must agree).

8. What is exit strategy? (Hint: All must agree on ultimate goals of venture and timeframe to get out).

9. What is growth/operating strategy? For instance, is it slow and steady growth, or massive investment to get customers? Are you frugal or do you get a nice office to impress investors, or something in between?

10. What is capital strategy? When will you take on debt? When will you give up equity? Do you pay contractors for equity? (Suggestion: Don’t give up equity to anyone who doesn’t directly contribute to long-term enterprise value and, if you do, stage it out with first vesting happening after a year).

What else?

Replay

Category: marketing Time: 2005-02-22 Views: 1
Tags:

Related post

  • Some key questions to ask your clients when designing quality sites for them 2005-07-25

    It is my experience that many web designers have a terrific opportunity to shift from being web designers to being marketing consulting for their clients. Most web designers are in fact supposed to be marketing consultants, responsible for helping cl

  • Good questions to ask the CEO and CTO of a start-up during an interview 2011-05-07

    There are numerous questions on this site regarding questions to ask a potential employer during an interview. However, I was wondering if there were specific questions that should be asked when having an interview at a small start up? Working at a n

  • What are good questions to ask a sales engineer candidate? 2011-09-06

    What are good interview questions to ask a candidate for a sales engineer position? We're an enterprise software company and the candidate we hire needs to be able to (and I think this holds for any company hiring to this position). I write "customer

  • few questions to ask about ISPConfig3 2013-10-10

    Hey Guys I have few questions to ask about ISPconfig I got the current version installed onto my Ubuntu 12.04.3:LTS just fine but here is an few questions I need to be answered: 1.) does ispconfig have an option to limit bandwidth per client/website

  • Slow Down! 5 Important Questions to Ask Before Taking on Rush Projects 2009-08-27

    Understandably, all clients think their projects are urgent. It's the nature of business and society today – we want it done now and we want it done well. But before you commit to pulling an all-nighter to meet an unrealistic deadline, here are five

  • What are questions to ask when planning database backups? 2010-10-16

    Examples: Was is the operating environment? How large of a dataset? Are offline backups acceptable? Is point-in-time restoration a requirement? What storage engine? CONTEXT: Want to ask how to do MySQL backups on CentOS, but want to make sure I under

  • What are the right questions to ask when deciding whether to use Chef or Puppet? 2011-02-06

    I am about to start a new project which will, in part, require deploying many identical nodes of approximately three different classes: Data nodes, which will run sharded instances of MongoDB. Application nodes, which will run instances of a Ruby on

  • What are good questions to ask when interviewing intranet users for persona development? 2012-10-09

    This question already has an answer here: what question should be asked to make a persona 4 answers I'm part of an external team hired to improve a software engineering company's intranet. I have been tasked with developing a usable set of personas o

  • Questions to ask to ensure someone understands programming? (and iOS) 2013-06-30

    So, I've been tutoring my friend for 2 years. Most people learn programming on their own in 3-6 months, (sans algorithms). It's confusing 'cause he'll run anywhere I tell him to, understands how to read C and C++ honestly better than the average coll

  • RSA key, github keeps asking for my password 2010-07-07

    Okay folks, noob RSA question here. I have a production server, and I've generated an rsa key there. I've then taken the public key (id_rsa.pub) and given that to github, as a deploy key I believe. What I'm trying to do is automate a deployment scrip

  • Questions to ask before someone leaves 2010-11-02

    This question already has an answer here: What actions to take when people leave the team? [duplicate] 6 answers Apart from the obvious questions relating to specific project work someone is working on are there any questions I should be asking a fel

  • Questions to ask in a comparative usability study 2012-04-15

    As I mentioned in this question, I've been working on proof-of-concept applications for social network privacy and running usability studies to evaluate them for publication. I'm a beginner to user studies at best, and I'm ashamed to admit that I don

  • Foreign and primary keys question 2016-01-26

    I have have looked for an answer for my questions everywhere but they seem confusing to me.Can a foreign key be a primary key in the same table? Can a foreign key be a primary key in another table? Can a foreign key take values that repeat themselves

  • Marketing questions to ask your prospects 2005-10-03

    A recent blog post by a Sitepoint reader wondered what kinds of marketing questions web designers should ask prospects, in order to help them see you as a marketing solutions provider. Here are some suggestions: 1. What are your sales goals? 2. How d

  • Should I tell the interviewer I already know the answer to the question being asked? 2010-11-15

    In a programming interview if I am asked a question I already know the answer for, such as giving an algorithm for a particular problem. Should I disclose that to the interviewer? This issue only makes sense when there's a novelty aspect to the quest

  • Simple SSH public/private key question 2010-12-23

    I am trying to learn this instead of just following guides so I can recommend proper actions when people do ask (and they do). Here is what I got down. First, generate both key with command such as this: ssh-keygen -b 2048 -t rsa -C comment -f ~/.ssh

  • What is a good question to ask a designer in the context of an interview for a website? 2011-08-24

    If you were interviewing for your first graphic design position, what kind of questions should you expect? The posting is fairly vague, aside from the assumption of basic design skills. --------------Solutions------------- If you're being asked a lot

  • Should an interviewer be prepared to answer any question he asks? 2011-12-13

    As I gain more professional experience, I've become a bit more skeptical about a lot of the politics of the interview process. In particular, I'm curious to know if y'all think it's ok to ask the interviewer the same questions you're asked. For insta

  • Public key authentication - SSH asks for passphrase after rebooting local machine? 2011-12-29

    I created a public/private key pair on a local machine using ssh-keygen. I entered a passphrase. I then used ssh-id-copy to put the public key on the remote machine. When I ssh into the remote machine I'm asked for my passphrase after each each reboo

iOS development

Android development

Python development

JAVA development

Development language

PHP development

Ruby development

search

Front-end development

Database

development tools

Open Platform

Javascript development

.NET development

cloud computing

server

Copyright (C) avrocks.com, All Rights Reserved.

processed in 0.472 (s). 13 q(s)