I bake.
Three other people have offered to start a business with me.
Two of them have money and will buy me an oven, ingredients and equipment.
One of them will put in a small amount of money but mostly contribute selling baked goods and event setup.
I am in theory going to bake a lot of things and pay no money. They want me to be an owner not an employee.
I'm a little worried I wouldn't be getting paid in money but in a 1/4 share of the business and 1/4 share of any profit.
Part of me is happy at the idea of getting to stay home and bake for money, but I don't understand.
I am told I would not have to pay any money in and that my "sweat equity" would be my "buy in."
I am told this is kind of why the third person is not paying much but they are selling the product and setting up events.
The first two have the money. The third person transports everything to offices and catered events and does bookkeeping.
I have no idea if I should do this or not. I am happy smeone thought I was a good enough cook to suggest it.
So, if people buy equipment, they own that equipment. So the two "money guys" will own the equipment necessary for operation of the business.
If a person sells things, they typically get their cut of the profits first. So the "sales guy" will get a percentage of the profits off the top. And/or under-report sales and pocket extra money.
If a company is owned by 4 people, three of them can outvote the fourth.
In sum: Your "friends" are seeking to exploit you, probably. You'll be an "owner", so you
don't have to be paid minimum wage. Thus, their "genius business idea" will commit you to making
less money than if you just got a job at Wal-Mart's bakery.
...it's highly suspicious that three people all approach you with such an idea.
BUT, maybe this was just idle dinner conversation. I was hanging out with some friends and we discussed briefly how we would run an restaurant together. None of us really cooked, so it was probably just talking for fun.