My business partner started a business 4 years ago and really did not have the experience or knowledge to make it successful. He tried for 1.5 years and just dumped money at the problems hoping they would fix them.
Fast forward to today (I've been here for 2.5 years now) and we are beginning to put money back into the bank. He and I have a 50/50 ownership split. Originally, I was hired to manage and I knocked it out of the park and was offered half the business. My value I bring is industry expertise, his is $$$.
To be frank, I have removed him from MOST aspects of the business as anything I have entrusted him with, the ball will get dropped. Love the guy, but more of a wantrapeneur.
Ok so here's the question.
He feels that the money he put into the company before me and his initial investment to open the business should take a higher priority when it comes to payments/repayments. Aka, he wants me to take X amount of profit and 40% goes to repaying him, 10% to savings and 50% gets split between us.
One side of me sees his point of view; he put lets just say, 300k, into the business and he wants his money out of it. HOWEVER, there is another side of me that says "you started this business, you ran it poorly."
I do not want to sound like I'm trying to screw the guy but why should the business pay him higher %'s of hard earned profit to repay money that is "cost of doing business" specifically incurred because he didn't manage his business.
I'm simply looking for some creative ways to approach this problem because the amount of money he invested will take more than a couple of years to fully repay. I had to replace everything from the brand/offering all the way to managing our financial practices ect. I do everything. It's hard to imagine waiting so many years for payouts on my expertise because he threw money into a business foolishly.
Let me know what ya'll think.