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Seeking business advice on partnership

I'm looking for a bit of small business startup advice. I've never been involved in owning or investing in a small business, so hardly know where to begin. This idea is really in the very early stages, so I'll be doing a lot of research, but I'm pretty sure there are folks here with experience that might lend some insight.

A good friend of mine is a pretty good cook. BBQ is his love and he's pretty damned good at it in my and many other people's opinion. In the past he's worked and managed a couple of bar/grill type kitchens, but never owned his own. He's been working the past few years as a mortgage broker and right about now he's dead broke. I also work a full time job, with no plans to give it up. We've been tossing around the idea of doing a vending cart business in the downtown area selling BBQ. Start-up costs would be about $20-25k, of which I'd be the sole money guy. My buddy would do the cooking and would man the cart. There are a number of business considerations - we need a health-dept approved kitchen, so need to lease space/time in the kitchen of a local restaurant. Storage for food, for the cart. The business will operate full-time only 7-8 months of the year.

So here's my biggest question about this kind of partnership. Mostly it involves the disparity in our duties and investment.

I'll invest all the cash, and he'll do all the work. At best, I could handle the book-keeping, some errands and some purchasing. How do we split ownership, as well as profit & loss? I don't it expect to be profitable out of the gate, but what about two years down the road if we succeed? He's putting in 20-30 hours per week, and I'm doing almost no work at all. That's not necessarily fair to him. On the flip side, what if we decide to pull up stakes after a year - should he have 50% equity in any physical assets that we liquidate?

Thanks.




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Topic - Seeking business advice on partnership - J.Mac 13:40:57 03/29/07 (8)


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