# Ownership dilemma



## drewh0120 (Nov 13, 2015)

I have a friend that's letting me use her place to print my shirts. She wants to secure her side of the business by owning a percent of the company. 

I don't even know how to answer that. 

What area's should I be looking at to making a decision?


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## kimura-mma (Jul 26, 2008)

If she's providing a space or service, just pay her the going rate. Why would she get a percentage of your business? What is she putting into it? What is she expecting to get out of it?


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## jennGO (Mar 11, 2014)

Totally ridiculous. Just pay her rent and equipment rental fees. If she isn't happy go rent some other place... Sounds like she wants a lot of something for nothing.


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## Kenneth59 (Sep 28, 2013)

drewh0120 said:


> I have a friend that's letting me use her place to print my shirts. She wants to secure her side of the business by owning a percent of the company.
> 
> I don't even know how to answer that.
> 
> What area's should I be looking at to making a decision?


Actually this is pretty funny, she lets you use her place free and now wants a percentage of your business? Thats crazy. Pay her a predetermined amount of rent each month and be done with it, she dont like it then move on. Keep going like you are and it doesnt sound like you two will be friends much longer


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## Bugmeister (Dec 6, 2015)

> She wants to secure her side of the business by owning a percent of the company.


I'm a bit confused by this - what do you mean by "her side of the business"? Is this venture something that you both came up with and started into together? Has she been providing creative ideas or helping with production, contributing financially (apart from the space) or otherwise?

If it has been a joint business from the start, then you should be discussing a partnership. It doesn't have to be an equal partnership as there are many ways of determining percentages, returns and contributions to the business.

If the idea, equipment, inventory, labour and cash outlay has been yours and yours alone, with her just offering to provide you with a place to do your thing, then it sounds more appropriate to have a landlord/tenant agreement for monthly rental of the space.

How long do you plan to use her place for your setup? How much of her space are you using? Answers to questions like that can lead to some creative solutions between partnership and tenantship.


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## MungoLarry (Jan 10, 2016)

TOTALLY agree with the other posts. Give her rent unsells she is contributing to the business in another way. According to the information you have provided she is only a landlord. Landlords don't get your business, they get your rent!


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## Blue92 (Oct 8, 2010)

drewh0120 said:


> I have a friend that's* letting me use her place to print my shirts.* She wants to secure her side of the business by owning a percent of the company.
> 
> I don't even know how to answer that.
> 
> What area's should I be looking at to making a decision?


Is she providing work space only or letting you use her equipment? If space only offer to pay her rent. 

If you are using equipment that she owns you might arrange to pay for that as well.

What exactly does she see as "her side of the business"?


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## royster13 (Aug 14, 2007)

For those who say her request is "ridiculous", "crazy", "funny", etc.... may not know the whole picture....The only thing that can be said, is if you are using her space and/or equipment for free, then perhaps she deserves some compensation...If you have enough cash flow to pay some some rent, go for it.....If you are in the startup stages, perhaps giving her a % of equity is not such a bad idea......


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## jennGO (Mar 11, 2014)

Whoa thanks for targeting me specifically?? Super annoying and rude. Obviously we don't know the whole story this isn't court


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## royster13 (Aug 14, 2007)

jennGO said:


> Whoa thanks for targeting me specifically?? Super annoying and rude. Obviously we don't know the whole story this isn't court


I did not mean to point to you directly so I probably should not have used such a "sharp weapon?......I should have used something more "blunt" like a "sledgehammer" and included all...


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## drewh0120 (Nov 13, 2015)

Long story short. I decided to leave.


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## jennGO (Mar 11, 2014)

Nice. Hopefully you're still friends...haha. I've had countless people want a share...want a percentage of sales. No sense in giving up decision-making power just for space. On the television show The Profit (which is yes a reality show, no not a good idea to make decisions based on what you see on TV, always consult a lawyer blah blah blah) there was this one company that had a similar situation where one of the three partners supplied the property which was of significantly less value than what the other partners had put in money/time-wise yet owned an equal share. Led to a lot of problems down the line when the 2 wanted to do something and couldn't get the other guy on board. I guess I'm just cynical but the less hands in the pot the better for me. Not even planning on getting a partner down the road. 

Good luck to you


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## drewh0120 (Nov 13, 2015)

jennGO said:


> Nice. Hopefully you're still friends...haha. I've had countless people want a share...want a percentage of sales. No sense in giving up decision-making power just for space. On the television show The Profit (which is yes a reality show, no not a good idea to make decisions based on what you see on TV, always consult a lawyer blah blah blah) there was this one company that had a similar situation where one of the three partners supplied the property which was of significantly less value than what the other partners had put in money/time-wise yet owned an equal share. Led to a lot of problems down the line when the 2 wanted to do something and couldn't get the other guy on board. I guess I'm just cynical but the less hands in the pot the better for me. Not even planning on getting a partner down the road.
> 
> Good luck to you


Yep. I have to sell my equipment to make ends meet now because im not allowed to print any shirts unless theres an agreement in ownership.


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## Bugmeister (Dec 6, 2015)

Sounds like there's more to the situation...


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## jennGO (Mar 11, 2014)

Agreed ^ 
You should possibly consider getting a lawyer because I don't understand why there would be a non-compete clause and why you need to sell the equipment because if there is no formal agreement in ownership nor oral agreement for ownership why is this even happening. My closest friend is a lawyer and I'm continually shocked how often in daily life people I know are getting screwed because they didn't talk to a lawyer before doing something. She's not breaching confidentiality I will just tell her oh can you believe this and she says well legally that isn't right... Problems ranging from rental apartments to business. At the very least find out how much a lawyer is before not considering talking to one.


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## drewh0120 (Nov 13, 2015)

Bugmeister said:


> Sounds like there's more to the situation...


I created this thread to look for options. Why are you trying to understand more on a situation I just said I was leaving from? How does that benefit you in any way right now in assisting me on a decision already made?


i came to seek information for a decision. I made a decision and you want to stick your nose deeper. Why?


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## Bugmeister (Dec 6, 2015)

I commented, because it seems unusual to be forced into (and refusing to) give up a part of business in exchange for space usage, stating that you can't print ANY tshirts period, and winding up having to sell what I assume is your equipment instead of finding another solution such as new workspace, different shirt designs or whatever is holding you up here.

You asked a question looking for advice, if you're not interested in receiving advice or ideas on how to maintain and move forward with your livelihood, why are you bothering to post here? You asked for advice, you received some but now I'm an idiot for trying to help? Yes, perhaps I am. Good luck.


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## jennGO (Mar 11, 2014)

Yeah what is wrong with you? Clay is a very helpful person. I regret responding to you now. That was rude and unwarranted.


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## GTP30 (Dec 18, 2015)

drewh0120 said:


> You're an idiot. I created this thread to look for options. Why are you trying to understand more on a situation I just said I was leaving from? How does that benefit you in any way right now in assisting me on a decision already made?
> 
> 
> i came to seek information for a decision. I made a decision and you want to stick your nose deeper. Why?


Take a breathe, I'm sure when you replied you were upset but lets not start lashing out at those trying to help. It does seem odd you would have to sell your equipment and not be able to print shirts unless an agreement is made.
If she only let you use her space, move your equipment and keep on keeping on. Hope it works out for you and your "friendship". Seems like a ****ty/greedy friend and not really a friend at all.


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## royster13 (Aug 14, 2007)

jennGO said:


> Agreed ^
> You should possibly consider getting a lawyer because I don't understand why there would be a non-compete clause and why you need to sell the equipment because if there is no formal agreement in ownership nor oral agreement for ownership why is this even happening.


Sounds like you are reading way more into this than me...where do you come up with the idea there a "non compete"?.....


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## jennGO (Mar 11, 2014)

royster13 said:


> Sounds like you are reading way more into this than me...where do you come up with the idea there a "non compete"?.....


When he said that he can't continue business without selling the equipment it sounded to me like this person is claiming he can't do business as he wishes. Doesn't make sense that the space-provider who has no ownership could dictate the course of the business. Anyways nothing against you Royce but I don't really want to keep posting here after the OP lashed out at Clay. I don't like what he said.


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## royster13 (Aug 14, 2007)

Or maybe he just does not have a space to work in....


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## drewh0120 (Nov 13, 2015)

I moved from one state to another depending on what I sell to hold me over financially. My first line of shirts which I paid somebody to print sold out pretty fast and made a decent size in profits. 3 weeks actually. So I said to myself, hm, I might as well learn to print and keep 100% of my profits. So that's what I did. I took a course, purchased what i needed which was pretty much all I had then had my followers excited when I presented some new designs. My prediction was that I can probably make a living off this If I had space. Long and behold, a friend of mine, offered me her space. I said, I just want the garage, I'll sleep on the floor I don't care. I don't want to interfere with your life. She insisted I do it in the house, taking up three rooms, her choice. She happened to be a neat freak. We all know printing shirts isn't always something clean, especially if you're doing it for the first time. This is where I think she started becoming uncomfortable. So then the 30% came. It was out of left field. I don't know where the hell that came from. Our agreement was that she would offer me the space and we can grow together. Nothing more and nothing less. If you're waiting for numbers and percentages, it was never discussed. She's somebody that lives alone and I've known for a few years. So I packed my stuff and made the move because I know what I can do and I know I can make it work. I'm the type of guy that if you deserve it then I won't leave you hanging dry. But I couldn't agree to 30% because she hasn't worked for it. My angle was that she can walk away whenever and hold 30% of what I grow the business into. It doesn't need her to survive, it needs me because the people that are buying it buys it because it's coming from me. I said, maybe few months down the road if we break some decent revenue where the conversation is actually something to talk about, then sure. We can discuss ownership because I can turn around and say, she's been with me since the first shirt, why the **** not? Well, she didn't agree and I didn't agree on giving someone a piece of something I worked to put together without having to put the work in. So I proposed another alternative. I don't have plans to go home and I don't have the money to move my stuff so I asked if I can print what I have to sell then next month I'll move everything into a commercial space and i'll pay rent. Well, this wasn't good enough for her and she said no. She wanted a piece. So now since I can't print, I have to go back home, save up what I can and start over.

There you have it. 

Like I said, I decided to leave.


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## PIAcademy (Oct 11, 2015)

"I have a friend that's letting me use her place...." I was going to say I've seen that train wreck before with lost relationships.
Sorry to hear the troubles. I hope things turn out as good as they can from here.


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## David09 (Oct 2, 2015)

It is better that you decide to leave


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## TeeBird100 (Apr 13, 2015)

Drew, 

It sounds like you made the right decision. Being an entrepreneur is a long and brutal, albeit rewarding, process. It sounds like your friend is taking advice from her "support group" and it got greedy. Having a partner is never to be taken lightly, be it 1% of 51%. 

Right now you have designs you know how to sell, that means you are ahead of 90% of the folks out there. Lick your wounds, head back home, and get back to work at it. 

In a couple of years this will be one of the stories you call tell at the local watering hole, or to a reporter, about the travails you encountered on your way to success.


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