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How do you determine partner worth. I am starting a business with a Doctor who has an MFT license who will be clinical director of the business. I will be program director. She says it is standard for her to get 70 percent because of her license and I have to split 30 percent with another partner.Me and the other partner will be performing 90% of the work load. How should we determine each persons percentage?
Greetings! I am happy to help you with this matter. I trust all is well. Congrats on your recent venture.
The big question is what do you she is entitled to? She says 70%, what do you and your partner thing?
What are your thoughts?
all 3 are investing capital. Her lawyer told her 70% is standard because of her licence. is this standard
we have no idea, it seems a bit high
If it seems high, you are not obligated to go into business with the person. Shop around, if you are getting the same rates, than maybe you should go with her and the person you trust.
is there a stand
Are you each planning on putting up equal capital?
It would be hard for someone to get the majority if everyone is paying the same capital?
I am not familiar with a standard.
Again, there is supply and demand. For example, it may be "standard" for an attorney who refers a case to another lawyer to get 33%.
However, some lawyers are of the opinion that if the lawyer is doing nothing on the case, than they should only get 20%. This has also be codified by certain state statutes.
What do you think she should be entitled to? Everything is ultimately negotiable is what I am saying.
50% and 25% for the other 2 partners
are you saying there is no standard or you don't know
It would likely to be wise to shop around, talk to others with a similar arrangements. I do not feel your counter-offer is unreasonable considering you doing the majority of the work. Additionally, you may also wish to structure the income based upon the total amount of income derived. For example, if you do certain things that she is incapable of doing therefore bringing in more money to the business you should be rewarded/compensated more..
I am saying that I have never heard of an industry standard.
Additionally, there are several factors that may determine what percentage each party receives. You should negotiate a rate all three parties feel are suitable. It is clear you are not comfortable giving this high amount, and I can't blame you.
you dont know what the percentage should be?
or how to determine what it should be?
I am not aware of a set percentage.
The way you determine what the percentage to be is based upon the facts between the parties, experience, work, capital, market, etc.
is there a formula?
I have heard of set up's of 50, 25, 25; 60, 20,20; 70, 15, 15
The formula is based upon your experience, your partners experience, the market, work, etc.
Also, it would probably be wise for you to be provided with certain "incentives" or "bonuses"
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Nothing that determines what her license is worth
Certainly the fact she is licensed is of value, but 70% seems very high.
Does that really seem equitable? I would certainly say no.
Good luck! My pleasure!
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