Partner leaving business query

May 27, 2010
Reaction score
At the beginning of this year 4 of us set up an internet business putting in an initial outlay of £500 each. We formed a Limited company. Since then we have put in long hours getting a fully operational website live with a fully functional Shopping Cart which just went live last week. So while the business in now set up it is just starting to receive orders ie no profit has been received yet.

One partner at the week-end took ill and is having to retire on health grounds. He is happy just to leave with a refund of his £500. The remaining 3 Directors are happy to do this.

We have one friend who would now like to come in as a partner but how do we value what we will charge them to come in and own 25% of the business ?

Do we start with the initial £500 investment each of us made and work out all the other costs we incurred getting the Shopping Cart up and running plus the value of any stock we have and divide that all by 4 and that is what they pay. How do we value all the hours and hours of work and travelling to source suppliers We assume any money that they do pay is just lodged into the business account in the normal way.

While the business really only opened its doors on the website for orders last week we all have put a great deal of effort, time and money getting to this stage and feel that this should be reflected in the sum any new partner pays to join.

Any advice you can give would be much appreciated.

Thank you.


Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Similar Threads