Hi folks,

I have web hosting business running and want to let my friend be a part of my business.So I would like to sell him a 49% of my business which will make him a business partner.
My hosting company making cca 1500-2000$ profit each month just a profit.
So what would be a good price of selling or leting him to get 49% of my hosting business??? Any sugestions??? Thank you very much!

There is no real hard and fast dollar amount that can be given to be honest, I'd say you are going about it the opposite I would. I'd say "how much of a contribution of capital and/or non-captial contributions is this person making?" and having them earn that percentage of the business. All with the appropriate paperwork and contracts, of course!

Edit to add my .02 cents warning against mixing business and friendship, though you didn't ask that in particular so I'll hush now.

Yeah what would be your friends contribution will he be just investing ? or working along with you ? Also how will he help your business grow ? there are many things you should consider ...

A legal advice would be a good idea.

Originally posted by Plexi_Hosting
There is no real hard and fast dollar amount that can be given to be honest, I'd say you are going about it the opposite I would. I'd say "how much of a contribution of capital and/or non-captial contributions is this person making?" and having them earn that percentage of the business. All with the appropriate paperwork and contracts, of course!

Edit to add my .02 cents warning against mixing business and friendship, though you didn't ask that in particular so I'll hush now.

Yes, he will be working with me. His target would be for a first 3 months to rise profit fo 25% and to make a total profit improvement for a 50% till 6th month of the next year!

I think the partner should be someone specefic to the task oriented like expert from sales, marketing or technical field rather than just a project manager. He should understand in terms of deliverables and responsibilities.

Why not introduce him into your business before giving him a stake? Phase him in with a trial period and see if he fits and actually makes a difference.

Just a thought ;)

borismo01,

If your partner is going to invest in your business certainly he will be not interested to be kept on trial period. ;) On other hand they’re going to invest on your company after trial and only when they find it a profit making company in long run. :)

From what i can interpret its not his partner but a friend! The whole point to me suggesting a trial period is to 'test the waters' and see the effect it has on the business.

Afterall, he might not have a positive impact - but i guess it depends on your objectives from a business perspective and as a friend as to what factors impact your decision.

As said above - business with friends and family = a big NONO!

Yes guys, I apsolutely agree with term no business with familly and friends, but put it this way that this guy is not that big friend of mine so I can take that risk and get him in business if he can make more money form my company.On the other side is great dealing with you guys since I will take yours advice and get him into business for a trial period and see how he can get through.If I see that he is a bingo and can do something positive than I will think about selling him a business share.

Yes guys, I apsolutely agree with term no business with familly and friends, but put it this way that this guy is not that big friend of mine so I can take that risk and get him in business if he can make more money form my company.On the other side is great dealing with you guys since I will take yours advice and get him into business for a trial period and see how he can get through.If I see that he is a bingo and can do something positive than I will think about selling him a business share.