Is div. possible mathematically, by working the weight of each contribution say example finance will weight - 50%, technical expertise - 25%., operations -25 % etc 1. land partners : land Owners providing Land - 25% weightage 2. People moving on initially and starting the processes at ground level , physically staying on site, Managing early day to day business. Setting up infrastructure at remote sites - 20 % weigtage 3.Working Partners : People moving in after process initiated and Managing day to day business of running - 20% weightage 4.Financial Risk Partners : People taking financial obligations , like arranging & providing finance, providing co-laterals security /morgaging properties, financial liabilities - 40 % 5.Technical Expertise partners : People having In & out knowlwdge of the workings of the business sector. - 20% 6. Anything else can be added or removed - X % Land : project cost ratio - 1:40 All further investement will be generated from the business itself. all weightages to be added and equal to 100 %. can any one help in deciding the % weightage for each contribution. and justify the same.
That's usually the case with early start-up entrepreneurs wherein every one struggles to create a "Happy Equity Index" to be able to decide the right proportion of equity division.
In your case, it seems there are too many stakeholders with diverse contribution to the business. Hence, all of you should give some time to the business to flourish than deciding equity division in haste. Though I'm not a supporter of promoting something on Clarity, I'd like to share "Happy Equity Index" write up for your perusal. You can read it at http://366pi.com/one-business-with-multiple-co-founders-happy-equity-index/
Looking for any specific info? Do feel free to reach out.
Answered 10 years ago
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