I have always wanted to be a entrepreneur and a business owner and I now have the opportunity to start up a coffee truck with a "partner". He has offered to pay for all of the start up cost and all I will be responsible for is the inventory and gas. My equity will be earned by running the operation and the terms of the deal are a 50/50 ownership in the company and a 50/50 split on net revenue. I will be responsible for all of the work and the partners 50% take will be used to pay off the truck. Once paid off I will have the option to buy him out for 10k.
I have never done a sweat equity partnership before and I have no idea if these terms are fair or not. I have several concerns mainly that my net profit portion will be very small until truck is paid off and that once it is I still have to pay my partner 10k to own the truck. I am really starting to think getting a small business loan would be a better deal, seeing as I won't have to make 50% net revenue payments on the loan.
So yeah any advice would be much appreciated. Should I run from this deal and just try to get a loan and start it myself.
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