Topic: The problem with percents... (Page 1 of 1)

Percent of company that is.

A lot of the business coming my way has been for a percent of the company, and cash as the cash comes in.

This seems to be a really awful way to go about the things IMO. I would much rather have the cash. Anyone have any advise in and around this topic. How do you get the cash from the client? How do you determine if a percent of the profit is worth while?

-Dan-

We've had one such offer which we didn't take, personally I would be very suspicious on stuff like this, maby if you would take on x-treamly low paying clients to build a portfolio this might be a way to go.
But if your work is the main source for food on the table... Nope, I wouldn't, try to raise the price and go for percentage + cash, or just cash. "A man's gotta eat" :-)

/Dan
btw, what's up with the tuts over at gurus, have you checked your hotmail latley?

Over the years I've acquired 10% of a whole bunch of companies that are no longer with us, in just this fashion. I set myself a couple of rules about it though. First, if I'm going to be working for shares, the job had better darn well be fun, as that might be the only value I get out of it. Second, regardless of how much % you want to give me, I need some money down, sometimes called an "earnest" payment. (As in, the people doing the offering are truly "in earnest" about this job of work, they're the real thing.) If this is my emplyer working this way, I'd get nervous, I work a job like that for the money, that's why I get up each day and go there! Still, I think I remember that Netscape was paying folks like this in the months before they went IPO, and *everybody* became a millionaire! On the other hand, those days are past, and chances are those shares will never make you rich, SO... I dislike working that way, maybe only a few times, think of it as lottey tickets, heh.

Your pal, -doc-

I like the idea of 'earnest payment' sounds like the way to go.

I have the feeling that if they are willing to give up a percentage of the company for work rendered the company must not be that strong at all. Otherwise, why would they be so willing to give out percents of the company...

Thanks for the advice.

edit TP: spam removed. freaking spam bots...

(Edited by Tyberius Prime on 05-03-2010 10:25)

SPAM!

(Edited by Jestah on 12-28-2010 23:03)