I will be celebrating my 7th anniversary (Whoo Hoo!!) this month for my professional services company serving government and commercial clients.
I am the sole owner of my company, and have a team of 1099s who have worked with me for the past 7 years. They each have their own consulting firms and work with other companies as well. It’s worked great for all of us.
One of these subs and I have been interested in becoming biz partners for a few years now. From an equity POV, I decided the easiest way to do this would be to keep my current company owned only by me, focus only on our current and future govt contracts, and open up a new company with my sub and focus on only commercial clients with that company. We have an operating agreement in the works, and are setting this up as 50/50 ownership, 50/50 for expenses and profits, we’ll price projects with our individual labor hours if we work on the project, and a line item for at least 40% to cover expenses and a profit, and will be defining a mechanism (likely arbitration) to use if we can’t reach consensus on biz decisions.
Here’s my question- what did you run into while having a biz partner that you wished you had prepared better for? Is there anything we aren’t thinking of as we set up this biz marriage that we should be planning for?
TIA!
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