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I have been offered to develop a web application from scratch and have been offered 10% of the pie, if and when the project becomes profitable.

I'm not sure if 10% is right, they say I will be the fifth partner.

Is 10% about right in such situations? Where a technical guy develops from scratch? Can somebody point to any metrics I should consider?

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You're being duped.

You're doing 100% of the work for the POTENTIAL of 10% of the profits.

  • How will the site be marketed?
  • How much money will be spent on marketing?
  • Whose money will be spent on marketing?
  • What is the target market?
  • How much will the services be sold for?
  • Who collects and distributes the money?
  • How long between the time a customer pays and the time you get your 10%???
  • Who OWNS the software?
  • Who's going to run and control the web server?
  • Who will be the owner-of-record for the site?
  • Can you prevent your business partners from running off with your work?
  • What is the form of the organization? (corporation, LLC, partnership, etc)
  • How will it be documented that you are a partner?
  • What is the work background of all the partners? How does each one's experience directly benefit the partnership?
  • How much work is everyone else expected to do?

If you haven't answered all of these questions, don't do a shred of work until you can. If you go asking these questions and there's any hesitation by your partners, RUN LIKE HELL. Leave it alone.

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