2 other guys and myself decided to put together a young mens online magazine. We collectively came up with the name, but I came up with the concept of the magazine. 1 guy does the writing and the other designs and executes our website. I am Editor-In chief and also heads as creative & Social Media Director. So far, I have coordinated and styled all the photo shoots, handled our Public Relations with my contacts and maintained our twitter and facebook. I also put together trend reports and come up with the overall content in the magazine.
I have always been told to figure out your equity as co-founders before there is money on the table. Now we are getting advertising offers and I need to figure out what is fair to take.
I would like to know what should I ask for. I want to take 60-70%, web designer takes 30-40% and the writer takes 10% or something.
What are your thoughts?? What is fair?
First, if you take 60-70% and the web designer takes 30-40% then there's nothing left for the writer.
Second, equity should be split not based on what you've done prior to launch but how much you'll be doing after the launch. Writers make or break media outlets because they create the product. Is 10% of the business really a fair price for the writer's work?
Third, if you own more than 50% of the business you call all the shots. Are others content with such a distribution of power?
Fourth, the money that you'll get from advertisers goes into your company's bank account first. Then it is used to cover all operational expenses including but not limited to bills, salaries, and taxes. And if there's any profit left, you may issue some dividends to yourself based on the shares owned. Salaries need to be agreed and signed into contracts.