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Having read the all the suggestions, this is the one I'd recommend. Partnerships are more bother than they are worth. There are a lot of IF's: If he brings in

Having read the all the suggestions, this is the one I'd recommend. Partnerships are more bother than they are worth. There are a lot of IF's: If he brings in the business. If he does a "good" design. If he manages the client and responds to his calls. If he pays you on time. If he brings in clients that pay at the top end of the scale. Then he might be worth 50%. My impression is that your friend is trying to profit from your hard work. I don't see the amount of time as being 50/50. So you need to factor in whether his contribution is worth the 50%. In my experience you'd pay 5% for an introduction. 15% - 25% for the invoicing, collecting, account management. So really depends whether the design work is worth 35% or more. Another arrangement is that you get back to him and say, that if he makes the introduction, you take on the client and pay him a commission of 15% and bill the design work to the client and keep 15% for admin costs. A partnership or company is the last thing that I would suggest. Too many things can go wrong over time. Believe me, it took me 4 failed companies before I realised that it's impossible to reconcile expectations, especially when people have jobs, social life and other ever-changing issues in their lives. Good Luck!

lp456 17y ago
5% for an introduction? If I'm understanding this correctly he's selling and designing. The sale alone is worth 25%. Now I'm not saying 50% makes sense but 5% is incredibly low for a sale of anything (even if your cashmart). Agree on all other points.
- access_denied 17y ago
  Here in the german advertising scene the standard comission for an "successful recommendation" is about 15% no questions asked.
  - ErrantX 17y ago
    We have decided to pass on e-commerce work to another company (despite some of it being in the 10's of thousands) who have signed an agreement to pay 15% commission. So I think that is fairly standard all round.
jamiequint 17y ago
When I did Facebook app development consulting I did both the client sourcing and acquisition and the development/consulting. From my personal experience, 50% is not a high percentage for the amount of time spent on this work. Between managing Ad Words campaigns, talking to potential clients on the phone, spec-ing out projects, and making proposals, I'd say the time to get to the development stage far exceeded time actually developing. Also, you don't simply get a client once they are introduced, it almost never works that way. I would have to talk to clients for hours on the phone, most of who (as far as I can tell) had no actual interest in proceeding with the project, but wanted to ask a lot of questions anyway. The sales process is worth far more than 5%. I'd say this agreement is very fair.
ErrantX 17y ago
the split of work isnt 50/50 but I dont think the money split is unfair. or rather the amount I will be getting is fair for my time - he is getting a LOT for his time but it is him with the emotional investment - I can walk away he wants this to be his career. At the end of the day the split isnt my biggest concern so long as I get paid a fair amount for my efforts (probably what I would be paid were he just contracting work to me anyway). The main benefit of doing it "together" (under some kind of agreement) is that in the future if it becomes a full company I will be leaving (as I have a career) we have agreed that part of our signed agreement will include a pay off for me (probably in the region of a percentage of the first 2 years income - he said 50%.[lets split 50/50 all the way]... which seems very high :P) Anyway - thanks for the comments. Im sold on this approach over an LLP so I'll pitch it to him in our meeting next week :D

lp456 17y ago

5% for an introduction? If I'm understanding this correctly he's selling and designing. The sale alone is worth 25%. Now I'm not saying 50% makes sense but 5% is incredibly low for a sale of anything (even if your cashmart). Agree on all other points.

access_denied 17y ago
Here in the german advertising scene the standard comission for an "successful recommendation" is about 15% no questions asked.
- ErrantX 17y ago
  We have decided to pass on e-commerce work to another company (despite some of it being in the 10's of thousands) who have signed an agreement to pay 15% commission. So I think that is fairly standard all round.

jamiequint 17y ago

When I did Facebook app development consulting I did both the client sourcing and acquisition and the development/consulting. From my personal experience, 50% is not a high percentage for the amount of time spent on this work. Between managing Ad Words campaigns, talking to potential clients on the phone, spec-ing out projects, and making proposals, I'd say the time to get to the development stage far exceeded time actually developing. Also, you don't simply get a client once they are introduced, it almost never works that way. I would have to talk to clients for hours on the phone, most of who (as far as I can tell) had no actual interest in proceeding with the project, but wanted to ask a lot of questions anyway. The sales process is worth far more than 5%. I'd say this agreement is very fair.

ErrantX 17y ago

the split of work isnt 50/50 but I dont think the money split is unfair. or rather the amount I will be getting is fair for my time - he is getting a LOT for his time but it is him with the emotional investment - I can walk away he wants this to be his career. At the end of the day the split isnt my biggest concern so long as I get paid a fair amount for my efforts (probably what I would be paid were he just contracting work to me anyway). The main benefit of doing it "together" (under some kind of agreement) is that in the future if it becomes a full company I will be leaving (as I have a career) we have agreed that part of our signed agreement will include a pay off for me (probably in the region of a percentage of the first 2 years income - he said 50%.[lets split 50/50 all the way]... which seems very high :P) Anyway - thanks for the comments. Im sold on this approach over an LLP so I'll pitch it to him in our meeting next week :D