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I know we have a small handful of people who have been around the block on businesses here. While I will continue my career in the Zio-capitalist complex, I am seriously considering becoming a partner in a small business. I'd rather not get into the details here, but I want to put the question out there for people with experience in this area:
If there's anything you wish you knew before you started, what would it be? What's the greatest lesson you've learned?
Make sure you see the books. Know who your firm owes money to and who (government speaking) you must do business with in the locality and the relationship the firm has with them.
http://img.photobucket.com/albums/v3.../deadwood-.jpgQuote:
Originally Posted by Dreadnaught
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I am not long enough in the business to tell you lessons learned. But I can tell you what I think is very important, people. In small business is more like a family than larger companies, and if the key players are weak you will never get a successful business.Quote:
Originally Posted by Dreadnaught
Actually, I would be running the books. But it would be a primarily cash business and the employees would also be partners. I trust everyone involved (known them for a decade), but a big concern is I really do need to find good ways to incentivize everyone to keep things honest.Quote:
Originally Posted by Veldan Rath
Partnah.Quote:
Originally Posted by Nessus
Agreed. I wouldn't be considering this if I didn't think I could really make some money in the long-term and if I didn't trust the people involved. The main other potential partner has really proven himself working for other people, but he needs some help running things on his own because he's just not savvy with tax laws, strategy, regulations, etc.Quote:
Originally Posted by earthJoker
On that last point. The few people I know who run their own small business feel incredibly responsible for the people that work for them. As a result, they work hard. Very hard. And stupidly long hours. A failure of the business means those people employed in the business are out of work, and that is a huge responsibility.
Primarly Cash?
Run away now.
Running the books, huh. If you want the enterprise to be on the Up and Honest, consult a tax attorney first. Structure the business accordingly, use legal parlance, and get signatures from everyone involved.Quote:
Originally Posted by Dreadnaught
What's that mean? Are you trying to make money as a small business investor, or in venture capital? Are you trying to help build a business, get it off the ground and become profitable and sustainable, or are you acting as a hedge fund?Quote:
Agreed. I wouldn't be considering this if I didn't think I could really make some money in the long-term and if I didn't trust the people involved. The main other potential partner has really proven himself working for other people, but he needs some help running things on his own because he's just not savvy with tax laws, strategy, regulations, etc.
Why?Quote:
Originally Posted by Veldan Rath
What the heck? Not sure if I should be :rolleyes:ing or :confused:ing.Quote:
Originally Posted by GGT
The most important question I think is, If you did not know the people involved, would you buy whatever it is they're selling?
Think carefully about the answer and try to be as objective as possible. Try not to get blinded by friendship or greed. If you have to, put yourself in the shoes of the target audience, but do your best to answer that question honestly. If you have to work at convincing yourself that you would, it might not be a great idea to get involved in this.
If you do decide to go forward, it sounds like you're pretty well off on the trustworthiness situation. How big is this organization going to be at the start? What's your position going to be in this organization? Are you going to be incorporating? It sounds like if you're doing the books, you should ask to be made CFO. Get everything in writing as soon as possible. I know you trust these guys, but time can change things, stuff can happen, and it's better to get all the agreements on paper early on for anything that comes up. Make sure to hammer out what each person's stake in the enterprise is, what that means, and how they'll be getting paid out of the org's coffers.
Some of the above might be pretty obvious, but, you know, just in case...
Good luck with whatever happens.
My experience with primarily cash business is that someone is stealing, conning, and/or bribing.
Is it you? :p
Shhhhhh!
On the up side, cash businesses can provide excellent opportunities to launder money.Quote:
Originally Posted by Veldan Rath
So do laundromats.
It would just be 3-4 people. I'm definitely not 100% sold on my participation, but I'm very confident in the underlying service. The main other potential partner isn't a friend from college; I know him from his business. But we've become friendly over the past decade, which is why I'm considering this.Quote:
Originally Posted by Wraith
Exactly. :oQuote:
Originally Posted by Unheard Of