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My girlfriend wants 50% of my business


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Both My girlfriend and I are artists. I have been an artist for over 13 years, I have a full-time job as a paralegal, on the side I paint, am the curator of a art gallery, sell my work, and have made quite a name for myself locally. My dream has always been to quit my fulltime job and start up my own art gallery and live life as an artist.

 

I recently got into a relationship 1.5 years ago. She is also an artist but not as well known as I am but very talented. I want to start up a gallery now that I came into some money. I have shared the idea with my girlfriend and she seemed excited about it. I have a full-time job and she is a full-time artist. Financially I pay all the bills at home because she does not work, but she will help out here and there whenever she can. I have purchased approximately $2,000 worth of furniture and supplies for the business and she has chipped in approximately $300 on her end to buy things for the gallery as well.

 

I will be coming into some retirement money and will be using it all to purchase the building, construction etc. and she will be helping with her ideas and physical efforts around the gallery. Just recently we got into an argument because she brought up the fact that so wanted to be a 50% partner (on paper) in the business because she feels that she will be putting her heart, soul, efforts and time into the business. Is it fair for her to ask for that? And is it wrong or selfish of me to not want to do that? I feel that we both will be benefiting off of the business, especially since she does not work and continue to be a full-time artist through the gallery. But I feel I have more to lose if for any reason we were to break up.

 

She is making me feel guilty because she is now saying that I do not trust her and that she will be making a sacrifice living in the gallery with me until the business gets on its feet. I don't feel that I need a business partner but at the same time I do want her help. What should I do?

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It's unreasonable of her to expect to be a 50% partner if she's not contributing 50% of the financial stake. Sure, her efforts and time are valuable, but the cold hard fact is they doesn't merit equal equity partnership.

 

You are risking your money (retirement funds no less). She's risking her time and energy. If she can't see the difference then maybe you shouldn't be considering her as a business partner at all.

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Mixing business & pleasure is a recipe for failing at both.

 

If she is not going to be an owner in the business, is there a position you are willing to offer her say for a salary? if she is to become a partner, you have to treat this solely like an arm's length business transaction. . . you both get separate lawyers & hammer out a business plan. As a paralegal you should know the value of a well drafted agreement.

 

Don't make any business decisions because you "love each other" or because somebody will bring sweat equity to the table. That is too hard to quantify.

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I generally don't believe in mixing business with your personal life. Complicates things far too much at both ends IMO.

 

 

But if you do insist on going forward with this, I believe you do need to give her some equity in your business - not 50%, but some. You should not be expecting her to devote a significant amount of her time working for you without any payoff. Paying her a salary for help could be an alternative option, but that does sound a bit awkward when she's your girlfriend. Which again brings us to the point in my last paragraph...

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Just recently we got into an argument because she brought up the fact that so wanted to be a 50% partner (on paper) in the business because she feels that she will be putting her heart, soul, efforts and time into the business. Is it fair for her to ask for that?

 

Very few relationships are forever, what happens when you break-up with your "50% partner"? I'd give her free exhibit space and all her money back. Love and commerce are both complicated enough as is...

 

Mr. Lucky

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For people who are NOT married business partnerships are bought into..

 

If she only brings 10% to the table then 10% is what she buys into, the sweat equity is something both of you should bring equally and profits should be split or paychecks cut equally, ownership is always different than a paychecks

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thefooloftheyear

I can sympathize with her, but no way Jose...

 

I passed up several opportunities to take on partners in business ventures and I am glad I did...

 

Make sure she is properly compensated for her efforts, but don't take her on as a partner...It can and usually will get ugly....

 

TFY

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The problem is that the OP WANTS her help, i.e. he wants her to put in the work to get the business off the ground without any compensation.

 

 

 

I don't feel that I need a business partner but at the same time I do want her help.
It feels to me like he's trying to have his cake and eat it too, honestly.

 

 

I personally think that the right thing for him to do, if he doesn't want to give her any equity, would be to actually PAY someone to do the work instead of letting her do it for free. And backpay her for the free work that's already been done, and return her $300.

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I didn't read it that he didn't want to compensate her, but that he doesn't want to give her 50% ownership for her non-financial contributions.

 

 

He didn't mention intending to pay her at all, and he described her work as "help".

 

 

If he actually intended to pay her a salary, that's fine.

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It feels to me like he's trying to have his cake and eat it too, honestly.

 

I personally think that the right thing for him to do, if he doesn't want to give her any equity, would be to actually PAY someone to do the work instead of letting her do it for free. And backpay her for the free work that's already been done, and return her $300.

While it's a gray area, this is technically compensation too.
Financially I pay all the bills at home because she does not work, but she will help out here and there whenever she can.

 

 

Personally, I think you should do the math and offer her a percentage ownership that's reasonable for her investment. If you don't want to go that route, offer her a salary and have her pay her share of the bills from it.

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I always thought going 50/50 in a business venture was a bad idea to begin with. Someone should be the ultimate decision maker.

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No way.

 

I have a full-time job and she is a full-time artist. Financially I pay all the bills at home because she does not work, but she will help out here and there whenever she can. I have purchased approximately $2,000 worth of furniture and supplies for the business and she has chipped in approximately $300 on her end to buy things for the gallery as well.

 

Start putting her extra money toward the household bills, not toward the gallery. She's got a pretty good deal right now, being able to be a full time artist while you support her financially. What did she do 1.5 years ago to support herself before you came along? Have you asked her if she thinks it's fair that you have to support her while she lives her dream of being a full time artist?

 

I will be coming into some retirement money and will be using it all to purchase the building, construction etc. and she will be helping with her ideas and physical efforts around the gallery.

 

My suggestion is that you pay her hourly for her time when she helps around the new gallery. Whatever is a fair wage for that type of work.

 

Just recently we got into an argument because she brought up the fact that so wanted to be a 50% partner (on paper) in the business because she feels that she will be putting her heart, soul, efforts and time into the business. Is it fair for her to ask for that? And is it wrong or selfish of me to not want to do that?

 

I don't think you are wrong at all to not want to do that. You're very right that she is giving up nothing. As it is, she gets to be a full time artist and doesn't have to worry about supporting herself. So, she throws in a few hundred here and there, provides her "ideas," and thinks she deserves 50% of your business? No way. Pay her whatever a fair wage is in the industry for her time around the gallery and call it a day.

 

I feel that we both will be benefiting off of the business, especially since she does not work and continue to be a full-time artist through the gallery. But I feel I have more to lose if for any reason we were to break up.

 

You lose everything; she loses nothing and still gets to be a full time artist. Fair? No.

 

She is making me feel guilty because she is now saying that I do not trust her and that she will be making a sacrifice living in the gallery with me until the business gets on its feet. I don't feel that I need a business partner but at the same time I do want her help. What should I do?

 

If she feels she's making an unfair sacrifice, then she can go live somewhere else or work somewhere else. I really think you need to be firm on this. Pay her for her help, but do not give her an ownership interest in the business.

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I guess if you refuse the 50% she is probably going to walk out sooner or later. Few relationshps will survive that kind of a knock back.

 

You say she is very talented, and she is willing to put 100% in, so you need to weigh up if your business venture is truly viable without her.

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Return the $300 back to her. Tell her to get a job and support herself. If I were you, I wouldn’t even hire her. If her ideas were so great, she would have no problem supporting herself as a full-time artist.

 

Did her parents support her before you came along?

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I guess if you refuse the 50% she is probably going to walk out sooner or later. Few relationshps will survive that kind of a knock back.

 

Agreed, with the caveat it's difficult under any circumstances to maintain a relationship when entitled expectations are part of the mix.

 

He's already paying the bills at home and he's putting up the money for the venture. She seems to have artistic rather than business sensibilities...

 

Mr. Lucky

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Partnerships rarely work out.

 

OP is in a risky business being in the arts. He knows this.

 

OP is putting his freakin' retirement money on the line. (Not judging whether or not this is wise; that's not his question).

 

OP is more well known and successful in the art world.

 

Why in the world would OP make GF an equal partner under these facts? That would be insane.

 

The fact that the GF doesn't see it this way makes me question her business acumen (or maybe she's sharper than I assume, and she understands that she's taking advantage of the situation and OP's emotions).

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A start up business should have a good business plan and even more so when there are partnerships involved. The failure rate in start up business's is staggering in part by little to no business planning just operating on good ideas and hope it will work. I realize your not married that said, married couples working together in business is yet another world of it's own.

 

 

 

Whats on the table right now is a disaster in the making, the numbers are not adding up for a 50-50 partnership. I am not trying to discourage you not to put your project together but rather encouraging you to put together a comprehensive business plan. The best money spent is hiring a top flight CPA firm that also does business strategy planning.

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At the very least go talk to somebody in your local SBDC office for some low cost / free advice about starting a business. Bring your GF

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So here is a summary of the situation:

 

 

You pay her bills. She doesn't work. She is not contributing any money of note. You would be assuming all of the financial risk and entitling her to half of the money YOU are solely investing. She wants to have 1/2 of a business she has no risk in if it fails or you break up.

 

 

I mean, I would love to walk into Amazon and say, "Hey Bezos, I bought a nice chair for the office. Please give me 1/2 of the company".

 

 

What she is asking is out of line and smells of entitlement. The difference between an employee and an owner is the employee invests labor and the owner invests labor and money, stress, risk... If this fails, is she going to help pay the bills you are already paying because she does not have a job or money? If she breaks up with you and wants to dissolve the company and wants to sell assets you bought with your windfall and take the money are you willing to just give her half of the money you inherited so she can go on a nice vacation with her new boyfriend?

 

 

We have all had friends like this. You set up a lemonade stand, research lemonade recipes, buy all the ingredients, buy a table and a chair, make a sign...then your friend comes along with his own chair and "helps" you. Except he stays 15 minutes and gets bored because he has nothing of note invested. Then at the end of the day he comes back and demands 1/2 the money you made because 'he did all the work'. I would never take on a partner in any business venture that did not have an equal amount to lose because you will never be "equal".

 

 

If her abilities are such that your business cannot succeed with out her labor, then you could consider it but you still have to remember she could take her labor elsewhere at any point and I would not invest my money hoping the other person would come through. If she does not understand that labor is the easy thing to provide and she is not able or willing to put everything she owns on the line to an amount equal to you, then she is not someone you want to have a partner. In fact, if she applied for a business loan available to say women, and put up 1/2 the money through her own debt (which it sounds like she would never qualify for), then maybe. But I bet she won't consider it and would be offended if you told her to get a job, work for a year at her job and your company, get a loan or save up and then when she has the money she can buy in, she would flip out. That is the only thing that would be in any way fair for you so if she flips out, it would show you where her thinking is at.

 

 

Her thinking is you are her cash cow and security and since you are dating, you owe her the good life without that little hassle of risk. Not in a million years would I entertain her being a 50% partner.

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everybody says no

 

 

she is not a long-standing wife who has a reasonable claim on your retirement funds...maybe if you were together 10 years, ok, but 18 months is not that long

 

 

what was she living on when you very first met?

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Hot damn, I think there is a (nearly unanimous) consensus on this?!

 

I never see this happen so I feel excited for the OP that the accumulated wisdom all points in the same direction.

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Absolutely not. You don't mix money and business with people unless you're married to them and even then it can be a disaster.

 

You're a paralegal. Just tell her you got some legal advice on it and everyone said it was unadvisable. After all, it's unlikely you'll be together forever -- especially if you start having money and business problems. She is NOT contributing enough to be a part-owner. You're keeping her afloat. She sounds very selfish and money grubbing. Just tell her no. And don't marry her without signing a prenup since she's already trying to take your business.

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