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Thread: Starting up a New Business With a partner.. What to look out for

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    Starting up a New Business With a partner.. What to look out for

    Hi All,

    Just wanting some feed back from you all as to what i should be looking out for within a Partnership when it comes to the legal and binding side of things within the contract etc.

    As well as your personal experiences and what you think should be instituted as a control medium etc. (3rd party representation when disagreements are concerned etc?)

    Many thanks
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    Quote Originally Posted by Snoopy_inc View Post
    Just wanting some feed back from you all as to what i should be looking out for within a Partnership when it comes to the legal and binding side of things within the contract etc.
    Just a question here: what form will the business have? Partnership, CC, Pty?
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    Quote Originally Posted by Snoopy_inc View Post
    As well as your personal experiences and what you think should be instituted as a control medium etc. (3rd party representation when disagreements are concerned etc?)
    Having a clause that deals with this is quite common, and a really good idea. The clause deals with deadlocks, and normally provides for the appointment of an arbitrator.

    As Duncan points to above, the structure of the entity affects the partnership agreement and just what the "hot spots" might be.
    The trouble with opportunity is it normally comes dressed up as work.

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    Quote Originally Posted by dsd View Post
    Just a question here: what form will the business have? Partnership, CC, Pty?
    The business will be an online venture, it will be a CC but we are currently going to give it a test run under the current CC and make it a devision for the first 6 months.

    what i would like to know is; Can there be something in writing that says i have x% share in the devision, but that i dont have % in the holding company?

    IE if we had a company called "xyz holdings" and this company is the major company and now we create "abc group" as a devision of "xyz holdings" (to save costs on start up, registration, all the nessesary documentation) but hold a different set of books for the devision.
    The point of this (in my opinion) would be to see if the venture takes off.

    Your thoughts ?
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    Is there a particular reason, other than CC registration costs (which are very cheap), that you would prefer it as a division of xyz?
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    the hassel of starting up the company costs etc.

    To be deadly honest i dont see a reason why it should be a devision, was talking about it to the other partner and he recons we should start it as a devision for now till it takes off. Majority of that thought was based that we would use the holding companies suppliers etc without having to reregister with the suppliers etc
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    hrm... no response?

    Would have thought this is kinda a good topic to talk about as im sure others will come across this type of situation.
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    To some extent it's tricky to steer you in the right direction on such thin information, Snoopy. But I also know that you might not be able to say too much. My thought prompter would be this, though.
    Quote Originally Posted by Snoopy_inc View Post
    the hassel of starting up the company costs etc.
    Balance that against the hassle of fighting for your fair share if/when the "division" really takes off.
    The trouble with opportunity is it normally comes dressed up as work.

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    Quote Originally Posted by Dave A View Post
    Balance that against the hassle of fighting for your fair share if/when the "division" really takes off.
    I agree with Dave on that one. Sorry Snoopy, this slipped off my radar.

    A comment on the supplier issue: setting up contracts etc. etc. with suppliers can be quite a big schlep AND expose you to a lot of nasty sureties and so on. How about setting up a new company, and then buying supplies from the current company? Then there is no need to register with all the various suppliers again, and you get the benefits of clearing up ownership up front.
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    Thanks for the help.

    As a matter of interest what are we looking at costs for starting up a company?
    Hidden costs etc.

    Thanks
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