Page 189 - The $100 Startup_ Reinvent the Way You Make a Living, Do What You Love

Courtesy of Pamela Slim, a coach, author, and expert on partnerships, here’s
an abbreviated list of decisions you should make at the beginning of any joint
venture:

• How will the money be divided? (Common splits include an even 50-50,
60-40 with the higher share going to the partner who does more work,
and 45-45 with 10 percent reserved for administrative costs.)

• What are the responsibilities of each partner?
• What kind of information is shared between partners?
• How will the project be jointly marketed?
• How long will our agreement be in place?
• How often will we touch base to discuss the partnership?

Check out the One-Page Partnership Agreement for a simple way to spell out
basic agreements between two parties.

One-Page Partnership Agreement
Keep it simple. Remember that the relationship is the most important part;
choosing to keep it strong and trusting is more important than having the right
clauses and legal language. Many of our subjects report doing business for large
amounts of money on a long-term basis without any contracts at all. Here’s a
starting point. You should consult a qualified third party if you’d like to define
your obligations more clearly or if you’re concerned about something.

Partners: [Partner 1] and [Partner 2]. These partners agree to collaborate in
good faith on a mutually beneficial project known as [project name].

Overview: [summary of project, including outcomes and expected results]

Revenue Sharing: Net income for the project will be split on the basis of
[percentage] percent to [Partner 1] and [percentage] percent to [Partner 2]. All
minor costs associated with the project will be deducted prior to calculating net
income. If any particular cost exceeds [amount], both partners must approve the
decision.

Life of Revenue-Sharing Agreement: The revenue-sharing agreement will last
for [period of time], at the end of which the partners will decide if it should be
continued, discontinued, or revised.