Dream Come True

[davidplev]

i've only been a member here for about 6 months, asked a few questions, answered a few questions. i appreciate all the help everyone gets from each other here.
Ive been doing side work for a construction company for about 2 yrs now, they called me for a meeting acouple weeks ago. At that time, 6 of the main work force of the company explained that i have a "gift" that they are lacking, and they have an inteast in me starting my own business. i explained that i have no bank roll to try to start this. They said "hey dave, dont worry, were here" and continued to explain that all 6 of them are going to invest in me to get my own business, they already have a building for me. most of the work is there, but i can go outside of them for work also. The business will be mine with them as just investors monitoring me. i go to church with all these guys, ive known them for 2 yrs and im just estatic that they want to do this. it enables them to dabble into another relm of construction for them while benifiting me. We are now in the legal phase of things which is going good and hope to get this started by feb 18th. any body have there own full time business that could give me a few pointers would greatley be appreciated.

[crawler]

Get everything in writing. You know what they say about going into a business with friends/family. Have an attorney review all of legal documents and contracts.
Contracts are meant to keep everyone honest. Good luck and enjoy being your own boss.

[Ohio Mike]

Sounds like an interesting opportunity. However I've seen more than one person get burned on something like this, and being friends can make it worse since there some inherent trust there. You need to talk about and plan for things like partner #4 dying, or getting a divorce and his wife wants 50% of everything... get the picture?

This is a perfect example of a need for something like a limited liability corporation (LLC). You'll also want to account for any welding equipment etc that you put into the business.

[storts]

How many "Partners will you have,some times its tough to take one pay check!!,Jack:D

[fjk]

How important is your friendship with the other guys?

A couple of time's I've worked for people who were "outside-of-work"
friends before I started working for them (or had such friends work
for me). It was difficult and I generally refuse to do it again.

There are all the obvious potential problems and issues --
and most of them are not of the legal variety. Think of
the situation where your company fails and
you have to go to them and say "All your money is gone".
Or one/all of them decide that you're not running the company
the way they think it should be run and they come to you and
say "You should run your company in such and such a way".

These things can place terrible strains on friendships -- perhaps to
the breaking point. You have to decide what the risk is and whether
you are willing to take that risk. You have to judge both yourself
_and_ the other guys.

That all said, starting up something new is always fun -- it will be a
lot more work than you expect, you'll loose a lot more hair than you
thought you would -- and you'll miss the excitement when it's done :-)
Regardless of what you decide with respect to your friends, good luck.
And if you decide not to take up their offer, don't worry too much,
there are plenty of ways to raise the seed capital.

f

[davidplev]

thanks for all the feedback. the relationship we have is more of a proffesional rather than a freindship. i didnt know these guys until one day at a banquet at church i ran into them and small talk got me in the door. i would have to say that since they are investing, they have a high intrest in me acheiving as much as i can rather than let me fall short and fail.

[davidplev]

here is an outline of how it will be operating, as per our prior meeting...

i will be the only owner of the company.
there will be six investers (the other company).
these 2 companies will be kept seperate for many reasons Liability ect...
i will operate under a llc.
there investment is giving me a paycheck every 2 weeks.
all money that i make will go back into my company for equip. overhead ect.
i already have the equipment to start the business. since there insurance is an umbrella policy i can buy into that.

hope this helps clarify things...

[calweld]

Big problem I see is, are they expected to get priority???? Many years ago, I also had "help", and those that provided the "help" expected me to drop everything going if they needed something done ,,,, and ethically, I thought the same. While the regular work was nice, and important, it limited my ability to diversify my work, and eventually ended all relationships with those that "helped" me along ... the quotation marks mean the "help" really didn't help as much as anybody would think,,, I still made all the investment, still took all the risk .... think very hard before you go into a deal like this ....

[Sandy]

You really need to, at least temporarily, disassociate friendship and 'church' before making any business decision.

Also establish a clear understanding of what the expectations are for a return on this investment, ie., what do they expect. It is their investment and they do have the right to dictate certain perameters. Race car or welding shop, doesn't matter, it's their outlay. Can you live with those?

[Zrexxer]

At that time, 6 of the main work force of the company explained that i have a "gift" that they are lacking, and they have an inteast in me starting my own business. What is your "gift" that they are interested in exploiting?

[Howie F]

it isn't clear to me what they are getting out of this, did you leave something out ???.


Howie

[fjk]

here is an outline of how it will be operating, as per our prior meeting...

i will be the only owner of the company.
there will be six investers (the other company).
these 2 companies will be kept seperate for many reasons Liability ect...
i will operate under a llc.
there investment is giving me a paycheck every 2 weeks.
all money that i make will go back into my company for equip. overhead ect.
i already have the equipment to start the business. since there insurance is an umbrella policy i can buy into that.

hope this helps clarify things...

simple business question... where/how/when is their return?

f

[davidplev]

the returns will be no less than 5% and no more that 10% at the end of the year. we will all sit on a "board of directors" to calculate how much is dispensed. everything is done by votes. with 2nd parties unrelated(mediators).

as for them being priority, they will be at first until i get rolling, i probably wont go after any work until i get a grab on things. they have me booked until july this year.

My gift; being able to fabricate gerters,columns, stairways, handrailings mezzanines and install them right the first time without going back making repairs unless some dome excavater hits it with his back hoe. there is a lack of shops here were im at that do this.

you guys are giving me great feedback. keep it coming.. Thanks a million

I also have the option at anytime buying the investors out altogether or one by one...

[Rocky D]

Being a church-goer myself, I can understand your wanting to go ahead with this....a dream come true...church-goers operate with a different set of rules than non-church-goers...I can see that you do have a Gift for sure...I wish I could do it right the first time....I can see this thing getting real big real fast...you might want to take a small business management class, to help you out, too. You have 6 people who will want a good ROI from you, so you may start thinking of hiring people to help out.

[bobad]

It all depends on YOU.

There are going to be disagreements, requests for favors and more favors, power plays, petty bickering, and back biting. That's because all 7 of you are people, and all people are guilty of the above, to a greater or lesser degree. If you are the kind of guy that is a strong leader, keeps his eye on the prize, and laughs off all the silliness that pops up sometimes, you will be fine. If you let little things bother you and build up, you may as well give it up now.

If you will be relying on the proposed enterprise to pay the mortgage, and feed and educate the kids, it would be wise to follow all the good advice on getting sound legal counsel. Things change and things happen, and you need to be covered. There's a saying that 20% of all people are never satisfied with anything. So with that many partners, your venture is bound to not live up to the expectations of 1 or 2 of the partners. Just make sure you are covered.

Good luck. I hope you take the deal and live happily ever after.

[Critter]

i would take some care in that their investment doesn't engulf what you have for an investment in equipment already, in case of failure. Be clear in the writting as to 5% up to 10% of clear money at the end of the year, not gross, expenses can be high. I wish you the best of luck and hope you take the "opertunity" They are scarce! So are good friends.

[ZRX61]

...church-goers operate with a different set of rules than non-church-goers....
That's not neccassarily a good thing...

[Propulsion]

That's not neccassarily a good thing...

You just can't keep your nose clean can you ZRX61. Any time somebody references religion on this sight you open your pie hole. Are you sure you are a welder?:confused: And not just on the pay role at the ACLU to moniter this sight.:eek:

[Rocky D]

You just can't keep your nose clean can you ZRX61. Any time somebody references religion on this sight you open your pie hole. Are you sure you are a welder?:confused: And not just on the pay role at the ACLU to moniter this sight.:eek:
Prop, let's not be too hard on the guy...he's entitled to an opinion, it's just that he doesn't know that he doesn't know...he needs time to learn, and when he does, he will be more understanding of what I said. The great thing about this country is that we can have our own opinions....Amen.

[BBackSoon]

Saw a bumper sticker a while back that I think applies. “I like Jesus, it’s just some of his followers I have a problem with.”

I, from personal experience, have found some of the most religious people are the least Christian. I think that faith is a fine thing and if it helps you along the way, good for you. But if you are going to proclaim what a heathen I am because I drink, or cuss, or don’t go to church then you better not be cheating on your wife or your taxes.

If you can walk the walk then go for it, otherwise shut the Blank Up.

Remember this opinion is just that and it was free.

[Propulsion]

Prop, let's not be too hard on the guy...he's entitled to an opinion, it's just that he doesn't know that he doesn't know...he needs time to learn, and when he does, he will be more understanding of what I said. The great thing about this country is that we can have our own opinions....Amen.

Your right Rocky, my temper got the best of me. God please forgive me and ZRX61, sorry to your feelings.:D

[tomtri]

Another minor issue you could run into in the future is your own wage/salary/compensation. Who decides what you are worth now and in the future?

While you may need the "investors" at this point, what happens in the future when things are going well and you start to feel that, hey, why am I paying other people that do not actually produce anything?

This might not be the case in your situation but Ive seen it happen a few times before, so my advise would be to limit their investment into "your" business as much as possible.

[Some Creep]

Just remember that all 'investments' are called in at some point. Just knowing the 'when' is the key to making money. Ask any stockbroker or business adviser. Ask your investors what return they are looking at long-term and short-term. Also know things can change rapidly with personal and market changes. Do you have options other than this? Is there a reason they need you divested from where you currently are?

I'm not one to pee on someone's parade by any means, so don't take it the wrong way. Having your own source of finance to cover the unseen costs that come up is critical. Like was stated earlier, if one investor wants to cash out for some reason, or if work picks up to the point you MUST hire others, being able to do it without going back to the rest of your investors for more money will make YOUR business stronger and give YOU a stronger footing. The more they have to reinvest the weaker your personal stance becomes. Is additional funding possible outside of your investors? Bank loans, etc?

Dunno if I stated this clearly, but I'm sure you get the picture.....

[Broccoli1]

But if you are going to proclaim what a heathen I am because I drink, or cuss, or don’t go to church then you better not be cheating on your wife or your taxes.



well at least not your Taxes: God Forgives but the IRS don't!!:p

[Some Creep]

well at least not your Taxes: God Forgives but the IRS don't!!:p

LOL Ed, you kill me.

Either way it's going to cost you money! At least Uncle Sam tells you up front how much your penalty is! You cheat on your wife and her lawyer keeps that little bit of info secret until the end....:rolleyes:

Are we going to talk about religion again? Hooray!

*grabs bag of popcorn for the show*

Let me start:

My god is better than your god!

(now it's YOUR turn!) :D

[FM117]

Before you finish this up, spend the money and hire a attorney to review
the paperwork.
You wouldn't go to lawyer asking welding questions........
Dave P.

[BBackSoon]

My god is better than your god!

(now it's YOUR turn!) :D

Seems to me that is how wars start.

I was not trying to offend; just tired of people telling me how to live and then hiding their own dirty little secrets.

I don’t throw rocks, I do believe in Do unto others.... and I do try to not hurt anyone else. It is a shame that common courtesy is not so common anymore.

Ok, I'm done. Lets talk about parting and fusing metal together again.

[Zrexxer]

Seems to me that is how wars start.Just don't draw a picture of Mohammed. Good grief. :rolleyes: