| Profit share is always going to be a really bad idea for you in building a new company. How can you rightly invest your time in a project, and want to see it succeed if you are always looking out for the short term gain, rather than the long term future of the company. The correct decision might be to reinvest everything for a year. But this reinvestment will never ever ever (cannot stress this enough) be returned back to you. You will always want to see as much money be removed from the company as you can. Because any costs or reinvestment, immediately hurt your personal bottom line, and, if you are wanting to drain your new company, then it's always going to fail. 20% Profit share is a really bad deal.
Ideas aren't worth anything. It's the execution. What are you bringing to the table? What is your cofounder bringing? Can your partner execute his idea without you? Can you execute without your partner? Insist on equity, because otherwise you are a dead weight since you can never allign the companies better interests with your own. If your partner does not realise this, then he is stringing you along. |