I'm opening a gym with a friend, but I'm putting up all the funds. We've agreed to be "partners," but I don't know how to structure the ownership plan.
I've considered offering him a low initial ownership percentage (5-10) to show my faith in his potential to develop and operate the company. Then, structure a share increase based on the gym's success; possibly correlated to membership numbers or profitability.
I have also been told that I should consider giving him 40-50% initially and specify that my initial startup capital would be repaid first. I'm not sold on this option.
Does anyone have experience dealing with a partner who can not provide startup capital? I'm open to all suggestions about how to structure a share plan.