He Takes $20,000 a Month and Does Nothing
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- เผยแพร่เมื่อ 21 พ.ค. 2024
- He Takes $20,000 a Month and Does Nothing
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Would love to hear dad's side. LOL
Always two or more dudes if a story. Maybe he riding on the coat tails of Dad's success.
@@philshoup1582maybe
@@philshoup1582he said he’s been running it on his own for 5 years without his dad.
The dad probably worked his ass off to get the company to where it is today. And this is how he’s being treated by his son.
@@philshoup1582 seems to me like the opposite the dad is depending on the sons success.
Attorneys are employees. Truer words were ever spoken.
"I have been awful nice". Dude, he owns 51%.
And he owns 49%. So what? Majority shareholder doesn't mean it's fully yours. It just means you have majority share of the profits.
@@massimo4307Yes it does. If you own the majority of a business it is your business, and if u wanted to get rid of the other share holders you could. It’s your business of u own the majority that’s y some people never give up 51%
Dave's well rounded expertise was solid on this call.
If I start a business, I'm keeping it forever for the cash flow. If I bring a kid in and they make good money, it is a gift to them, not the orher way around.
Sounds like they built the business together. If dad started it and is handing the reigns over that’s different. They both put the same amount of sweat into starting this company from the ground up
@@soniak2269 That's according to the 49 percent owner of the company.
Id like to hear the 51 percent side of the story.
If you've put in enough work to own 49% vs 51%, and the "owner" Doesn't work anymore,the most logical path is to swap positions, the father will see negligible changes in income, yet the son is free to expand and create a mini empire while assuring his parents success. The middle class in this country has been killed by old fucks who don't NEED the money yet refuse to see a change in monthly deposits
@@soniak2269”Sounds like” you’re making assumptions.
Dad is 51% owner. It’s under his control. He decides why happens, period.
Dad building a successful business and THEN bringing Gary to participate is what the commenters are hearing. Gary and his Dad starting the business together from nothing is something completely different.
Could not agree more
Assumptions***
The son claims he and dad built the business together. Without hearing dad's take, that is what we and Dave) go on. The keyboard warriors filling in blanks they aren't qualified to do should give it a rest.
@@mikeb8342we can only dream, don't you think if they had something better to do they would do it?
Well in that case that would kind of make Gary an employee who's lucky enough to get 49 per cent of what his dad built. Just be happy with what you got and don't get too greedy then. This isn't a case of shark tank where Mark Cuban got a huge percentage of the company . Someone built it from the ground floor
Attorneys are not in charge. What great advice. I wish more people knew this in business.
Except that's not true. When a lawsuit happens, who do you listen to then? Attorneys are not employees. They are officers of the court. They are always obligated to take the side of the court and the law before any employer. Furthermore, they have higher ethical standards (or should in theory) than most people.
@@Grigsy Yeah, right.
@@GrigsyAttorneys are not in fact officers of the court, unless they are prosecutors. Not sure who told you that they were lol
Blaming dad for not having any reinvestment while drawing out 20k a month plus distribution of profits as an annual bonus is just asinine.
If it was my dad, I'd take care of my old man till the man above takes him to a better place.
Well said, honor your mother and father.
Saying my father "doesn't participate", or "take, take take" is very disrespectful.
Without the father there would not have been a business 15 years ago.
He never said I could have done this alone.
The problem in this situation is the child sounds like a spoiled little bitch.. it was probably the dads capital and backbone that built it
Yeah, the guy is making 20k a month and splitting profits. He could take 5k a month, reinvest the 15k a month into growth.
so you'll destroy a mutil million dollar company to help your pops?
@@19Burgandyhow is that destroying it? he’s still making more money than most people haha this prick is being greedy and doesn’t realise his old man is the one that built everything
My friend inherited a construction company from his father that does $2M per year in profit. He got all of the contracts, customers and equipment handed to him.
He has to pay his father $2,000 a week until he dies.
Outrageously good deal lol
It not actaully..
@@Cent51 explain how?
Can your friend run the business?
@@almaur703 yes he’s very competent in this area
It's a great deal. @@Cent51 104k in perpetuities on $2m in profits is 5%.
Guy invented the coffee machine and gave it to you and now you don't want to bring him a cup.
He's giving him closer to a whole pot of coffee lol
Does this guy realise that he would get 51% as inheritance eventually (so just shut up and just adjust 20k /month is good)
Dave is right ,Take a salary for your work .
Exactly. Like holy crap be nice to your DAD. It's most likely going to your down the road anyways.
Exactly let dad and mom retire comfortably they deserve it.
Maybe not. It could be split among mom, siblings, and other family. Plus, that could be in 20-30 years
@@marmantole that is why he should take salary
yeah just let your business eventually tank because you're taking 51 percent of your profits to an unproductive entity that's eating away any growth your company would have lol.
Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
Hi. I’ve been forced to find additional sources of income as I got retrenched. I barely have time to continue trading and watch my investments since I had my second child. Do you think I should take a break for a while from the market and focus on other things or return whenever I have free time or is it a continuous process? Thanks
@@Lourd-Bab However, if you do not have access to a professional like JUDITH ANN PEACE, quitting your job to focus on trading may not be the best approach. It is important to consider all options and seek guidance from reliable sources before making any major decisions. Consulting with an AI or using automated trading systems can also be helpful in managing investments while balancing other commitments.
@@PilouBen Oh please I’d love that. Thanks!
@@Lourd-Bab Judith Ann peace is her name
Lookup with her name on the webpage.
I paid my Dad a fixed rent for setting me up in business for over 8yrs that he just made up out of thin until he passed away😢. Did not once question him and i also paid an actual rent to the Landlord that owned the property we worked out of. Also gave him money to invest in other businesses aswell. That is respect this guy needs to learn. His Dad probably keeping the 51% because he knows deep down from experience.... an this guy proved him right again!
Gary is a manchild throwing his toys..
No concept of how to deal in business.
E
Two years for me to graduate with my Electrical engineering degree and NO I’m not 20yo
My father wanted to start a business with a horrible model in mind.
“Dad the website asks what will be the initial amount of stock, because it’ll be 3 owners i say 10,000”
His reply: wtf r u regarded why tf do you want our company to have stock?!?! Ur a dumbass
“What does the game plan look like for the company?”
Reply: I don’t give a shi. If that shi don’t work out I’ll just retire
“Ok but like I’m about to get my EE degree, if you’re not willing to talking things out I don’t feel confident about doing this”
His reply: are you a goddamn regard? I don’t have to tell you shi etc etc etc
Point is many fathers need to stop with the narcissistic behavior
Except there is no proof any of this applies to this guy, this guys dad isnt reinvesting the money in other businesses, he didnt grow the company and give it to his son, all you're saying is anecdotal to why your situation is different and does not apply
If this is such a bad deal, how about the son quits? Let them both hire a CEO.
Then they both won’t make any money 😂
@@pnwflipper2089 Need to do the math. If they pay the CEO what one of them gets then they still have the amount the other makes. That can be split in half. Neither works for it. Each gets same amount.
@@user-kp8tx6zv4r and both get a pay cut!
@@user-kp8tx6zv4rSomeone who manages 12 people doesn‘t need to make 20k
You wouldn't pay a CEO 20k unless it's a bigger business and structure that once they grow to 5mil, they get 250k a yr. Until then, 150-170k should be good with a bonus to 250-350k
This is an amazing example about Dave's background can help this thriving business and while saving the family
Not hearing both sides of the story here... Did DAD create the business? Did DAD get things going? Does DAD consider himself the CEO or President? At 51% ownership, did DAD give that 49% to son? How much is son profiting off what DAD did?
i mean dave’s advice still applies to all of that tho
I'm going to guess that dad funded the whole business and that is why he had 51%. Son likely had sweat equity to earn his 49% and isn't happy with that anymore.
You formed your statement as a question yet it’s clear you’ve made assumptions.
Did... not does. Sell and retire off that
Starting a business may entitle you to something for a period of time, but adding zero value loses its marginal utility to the business, industry and country at a certain tipping point.
Thinking you are entitled to suck off a teet in perpetuity without adding value or productivity is the cancerous ideology that is screwing this country
How can you run a company and not know the difference between dividends and salary.
You're assuming a corporate structure. If this is a partnership or an LLC taxed as a partnership, there are no owner wages. Understanding the difference between guaranteed payments and distributions is more nuanced.
@@kelleep535Not exactly. An owner of an LLC or partnership can still pay himself a W2 salary distinct from the pass through treatment (aka dividend).
Sounds like something my stepson pulled with me and my real estate business. I brought him in after he suffered from an emotional breakdown as a network admin. The business grew super fast. When I croak he would inherit everything which at this time was about $8 mil in residential rental real estate. One day he decided that we didn’t think a like and thought he would go off on his own and do his gig in real estate without me and still end up with all the current real estate holdings. Obviously he got too big for his trousers and flopped because he thought it was so easy.
End story, when he went off on his own, I cut him out of my real estate. No free rides.
He currently is 46. So a generation seeing their parent succeed thinking it’s no big deal without sacrifice.
The son calling in has a set of nuts not to appreciate what was handed to him. The son can be replaced for less than $240,000 per year.
I admire the way you dealt with his sense of entitlement.
Exactly
Who says his son didnt build the business from day 1?
The fact that "dad" cut out 1% to have some veto power makes him sound like an asshat
The fact that you ignored him saying that his dad is doing NOTHING for the business is very telling of who actually has a sense of entitlement here
In Seattle a competent person to run a pretty specialized business isn't going to be cheap, and then the son who has actually been running things could be your competition. And the son would still get paid his 49% of the profits.
$460,000-$200,000= $260,000 profit split between father and son 51%-49%. Dad would be receiving like $131,000, assuming the manager was both honest and competent. So the problem is that the son is doing all the work, and isn't drawing a salary for the work.
I totally approve of this advice and message.
An attorney won’t do shit when his dad has 51%
And dad probably financed the whole thing and is getting his equity back.
That’s Hollywood, not reality. 51% ownership doesn’t make you king like it does in the movies.
@@Quincy_MorrisYes it does
@@Quincy_Morris owning 51% of a company makes you owner of a company with very few exceptions.
The problem for dad is 51% does not matter if he doesn’t want to work the business. The son can pull up his stake and start over, he has the current relationships and drive to work. They just need to figure it out. But bottom line that 51% only entitles dad to 51% of net revenue after expenses and if he isn’t working he should not be getting a salary.
Did the same thing, took my dads business to $5 million a year, working 60 hour weeks and made $40k a year bc I was going to be "given" the business. Then after 12 years I was told I was going to have to "buy" the business. Left in less than a month.
How is the business doing without?
My husband had the same with his folks. They gave him money to open business. He did most of the work. Took virtually no salary but his folks lived off the business. 12 years. I had enough eventually and was so happy when covid killed it. His parents think my husband owes him their 'venture capital ' plus interest despite them living off it for 12 years.... nice
Not the same- he is taking home $250,000 a year not $40,000. The son is a jerk.
@@scottlaux6934the son WOULD be a jerk.... if he hadn't built the business WITH his dad. Unless you have some untold knowledge of this situation, the given is that THEY BOTH built the business together, but dad doesn't want to participate anymore. Since son let this fly for five years, he's going to have a helluva time getting this straightened out. Dad has entitlement syndrome.
"I can't go forward with this anymore."
. . . taking a salary of $20,000.00 per month must be really exhausting. Poor, son. 🙄
None of the people in the comments even listened to the entire story. He wants to figure out a way he can put money back into the business and possibly buy his dad out. He’s not satisfied with the current deal which I don’t blame him and Dave even agreed!
Yeah I would say the same thing about the father who is not doing anything for the business. The son is running the business, the father is just taking money from it.
@@jeraldbottcher1588: Indeed, but that's his prerogative as the majority owner.
@@danieljohnson4418 Actually taking money from the business before the bills are paid can be illegal. IN any case it may be legal, but it is very poor business. You always pay the bills including salaries 1st, then take profits. The son should have been taking a salary all along. Instead he has also been taking profits before paying the bills. His work may be worth far more than the amount he was taking, may be less. But the father is not involved in running the business. He is an investor.
The investors pay out should be directly related to the amount of profit, After the bills are paid. If the business was losing money would he then be entitled to 20k a month? and the answer to that is no. What if he takes the 20k but there is not enough money to pay the sone anything? does he still get the 20k? No
Dummy should cut his own income in half if he wants to grow. The dad clearly doesn’t care to grow.
Take your own money and walk. Start over and give him the whole thing.
Why in the world would you want to reset 15 years of work and building if you could find a way to make it work?
I'd be interested to know the specifics of how one can "take their own money" in this scenario?
Nahh Family is not Worth the extra % Let the Dad have it get Paid from Work Income..
@@robcd7112 Probably the money they saved over the years.
Yup or he cuts his income in half puts 10k from what he was earning (20k) and sacrifices his income for more in the future like his dad did when he started.
He said the word “MY” about 7 times within his first sentence. Just saying
This kid is a piece of work….
Spoiled kid wants dads share of the profit. If I were dad I would fire this kid and let him know I can replace you with someone much cheaper.
You’re daddy is the boss any day of the week.
Father has control , he sets rules . If he doesnt want to change it way it is
Bingo.
The majority owner of the company has different goals for the company than the minority owner. Tough cookies bud.
Son could quit as CEO/manager, and receive just under half of the profits. For every $202,000 receives, the son gets $198,000. It's in their interest to work together.
He needs to have Dad buy him out and then he quits. Start over, and take customers as it fails apart.
They just change the name of slave now they say employee
The owner got to keep their title
Slaves had an owner
Employees will say this is our owner
parents enslaving their children
its just "hired servants"
Master and servant
Owner and servant
Owner and slave
Owner and employee
Honor your' owners
Owners
Sell their home at a profits
Make an extra $100,000 or $200,000
Increase the cost of living on your kids $100,000.00 +
so that your kids gotta work that much extra time away from their home and family
Sell your home for a profit
the effect is immediate
& they can pay for the slavery you forced upon them
better yet
make the basic simple necessity of a home more & more unattainable
a completely out of reach goal
Have your kids go work everyday for money made from paper made from cotton 👁️ ∆ 💵
and put Egyptian pyramid on it so that they know that their slaves in Egypt
And you made their bed with Egyptian cotton sheets because you were mentally asleep
And get them to work and get part of their energy to enrich your life if you can do that with your children good if you can do it with other people's children even better
Get other people's kids to enrich your life while you enslave them in future generations
yea!!!! 👹
They don't need all their work energy to provide for themselves
they can provide for you l!!!!!!
get them to sign mortgages and loans / get them "sign" on a "flat line"
EKG ________________________
SIgN herE
Instead of living being a gift
enslave them!
MAKE THEM SURVIV E A LOAN 💵
E gypt them!!! she jipped them
This dude isn’t respecting his Dad. He’s not awful nice. He wants the deal done by cutting him out. What is his Dad going to live on? Dad wants to continue owning his company.
Yes!!! This comment!! Sounds like a spoiled, ungrateful kid who sounds like hes borderline trying a hostile takeover. Show some gratitude dude! Most kids only get their last name from their fathers
He said they started together from ashes in 2009, so they started and grew it together That’s what he’s saying at least.
I could never work with family I love them too much
Yeah it’s something I came to accept
Oh gosh, true! My dad and grandpa did great somehow. It was a farm. I'll have to ask for questions about that... I personally can't work with family. Too much tied up and someone feels taken advantage of in the end. And it does end.
Solid, solid advice!
I understand what Gary is trying to do and say, but the frustration is so overwhelming, it's coming out wrong when he says it and it's making him look bad.
Gary is an ungrateful POS
Dave is so smart, and handled that so well. God bless him. He helps so many people.
Hey everyone, have you been following the recent growth in the money markets?
Yes, I've been keeping an eye on short-term financial assets like treasury bills and commercial bills.
It seems like there's been some volatility lately, especially with interest rate changes.
That's true. It's crucial to stay ahead of these fluctuations to make informed investment decisions.
Yes, I have. Desiree has been incredibly helpful in navigating these money market issues.
I've heard great things about Desiree’s expertise in managing short-term investments and optimizing portfolio returns.
Great advice Dave
Translation: “my dad started and built a successful business. How can I benefit from it more than him by doing less work and assuming less risk than my dad did, while also not allowing my dad to benefit from his own work anymore?”
He is trying to take over his Father's company.
If he's patient he'll definitely inherit the company anyways. His dad CREATED the company to where it is today, that's way harder than running it. He deserve to sit back and get paid. But as Dave said there's a right way and wrong way to do it.
What's wrong with that? His dad doesn't work in it anymore.
@megalodon1726 his father started the business, and he is the owner of the company
@@JC-xu1cz they started it together
They started it together
Nailed it!
Dave is very underrated on business advice.
This advice was crap
@@crazylegs225 what part was bad advice?
@@crazylegs225Tell us how you would handle it.
@crazylegs225 Dave was absolutely spot on. Your response is proof you do not own a business.
@@kentuckyjim5108 exactly.
Thank you!
Money do make some people heartless. Dude, he is your dad. I don't know about other people but I will gladly let that money go for my mom or dad. Seems like the business is doing well. The son is already doing well; he just wants more. I would never put money over a good relationship with my family.
Dave is so logical. Take all the emotion out of it and lay out a good plan!
No way he will let the gravy train end.
Dave is right on this one. The father is not an employee so it is time to get the numbers completely right
Good advice. However, the problem is the father is still going to want his profit distribution; he's not going to want to reinvest those dollars into the business. So this small business still sounds like it will have cash flow issues.
Yep, that is why it is time to buy him out.
Dave's advice is spot on. The caller's problem is that he's working for free, not that his dad is a 51% owner. Caller needs to stop working for free and start getting paid for his work, else he should start his own company and then he'll retain 100% of the profits and he can work for his own company instead while also collecting 49% profit from the other company he shares with his dad (which according to the caller will be $0 without his working effort at the company).
My step son pulled that truck on me. I owned 51% and it was a running company for over 20 years. D he thought he would double dip. Didn’t work well for him. His business flopped and I cut him out of the preexisting business.
If the arrangement is the Don is a working owner, leaving the company voids the agreement. The son was to be working for his future instead of only seeing to the end of his nose.
Were you paying your stepson market wage?
@@mikemay777. It is sad he is trying to cut his own dad out of the business. His dad is a lot older and is tired, but he is probably giving important business advice. I am self employed and understand how hard it is to survive in business.
@@CroisMoispot on, he is an ungrateful pos,
He said he takes 20k a month also. Doesn’t sound like he’s working free…
What great advice
It's very hard to change what has been laid as the foundation of a company when family is the foundation. I found it was easier to just close the doors, move, and open up under a different name. Friends are the same ways. You can't let anyone take over or have major influence if you are the brains and want to remain in control. Family and friends will always have strings attached.
Dave’s advice here is fitting for the caller. It is his best-approach scenario. However, when all is considered, it may be improbable. But that’s okay. He’ll learn something either way.
you can tell dave knows how to put a deal together !
1:13 It's not your business. Congrats on being in a partnership. There should have been a path to control if he wanted you to run it some day.
Dad is the major shareholder. Suck it up and start your own business that you own.
Maybe this. If they can't get along, for sure this.
daves plan of him getting a CEO salary obviously makes sense, but good luck getting the dad to sign onto that, thats like asking Congress to vote for a paycut...
For real, or asking a landlord to reduce the rent, not gonna happen. Oh they'll listen if it's to benefit them, but if it makes sense or helps you, not happening.
The bottom line is after the business deal is done, they're still Father and Son. So it needs to be approached in that light.
Dave is wrong. 51% owner = owner. The son doesn't HAVE to buy him, he just wants to. And the son's not a good business person if he didn't understand he should be drawing a salary apart from his cut of the profits.
Dad probably worked until last few years but started slowing down, so both are drawing a salary but one stoped working
dave said 51% owner is not an owner?? when
you're forgetting the father-son dynamic here. If dad deceived son, it's not son's fault for trusting dad
@@yobs-kl3hnnever lol
Exactly what I said, son doesn't know enough to take a salary therefore is resentlful of dad but dad would be wise to take a buyout since son really doesn't have a clue how to even structure a business.
I’m sad that this gentleman has issues with his father he’s 46 his dad must be at least in his 70s, what were their roles to how they founded the business - that wasn’t discussed. did his dad front the money because that’s a big investment and risk especially if he’s 51% owner, I have a small business and if I could put my dad on payroll believe me, I would….. but I make enough just for myself ( but thankfully my 92 yr old dad is comfortable with his own retirement he worked for…. , so I feel bad that this gentleman Could possibly be forgetting how the business was founded who founded it, who put the risk of the money up… And one day - will he be getting 20 K a month and his own son running the business doing this to him?
IT IS NOT YOUR COMPANY. HE OWNS 51% OF THE COMPANY, HE IS THE MAJORITY SHARE HOLDER.
$3mm revenue, he & dad take $20k/month each off top (which is 16%) leaving 84% for OpEx then split net profit 51/49. This is a common family business structure. 1 Son should take an additional salary as CEO. 2. I wonder why Son was "unsuccessful" at buying Dad out in 2019. 3. Gotta really wonder if the $20k/month to Dad for last 5 years is part of the buyout plan... IJS
One of my coworkers had this exact same scenario except that the dad put in his Will to give the stepmom his 51%.
Hey Dad in this call .... can I have a job?
This is why you should NEVER go into business with your family. Your relationship with your parents is the second most important relationship in your life, only behind your own children. If you let money come between you and your father and ruin your relationship, youve done something terribly wrong along the way.
He sees it as an allowance not a salary.
Partnership sinking ship especially with family.
imagine working for this guy.
Greedy and I have a feeling there is a wife behind all of this
Father started the business for sure.
Complete mess
Their accounting is screwy
It’s his company. Good lord.
I’m a partner with my son in a company that does $50 Million a year revenue and i get $1Million a month and do nothing why? Because i started the damn company and was the one who risked everything
12 million in distribution is a bad use of capital...
@@Mr_Martz_Mc We are not trying to grow kiddo
Your bank risked everything.
@@ECUCHRIS904 How did my Bank risk anything? I never took out a loan and they just hold my money
You want take distributions then that’s all great and well. You don’t take a salary on top of your distribution share.
Dad owning 51% implies he started the business, or at least did more in the early stages to have the split draw up that way, therein making the son's demand ludicrous.
Getting a Income from working is smart you could set it Pretty High
Some companies share profits with employers. Not a lot of companies, and only very very small amount of the profits.
My guess is that the buyout would have to be huge for dad to voluntarily give up $240k/yr for doing nothing.
Dad: “Let’s see… I could do no work and receive $240k per year in perpetuity plus the big share of the profits…. Or, you could give me a one-time payout of what, like $1m and then nothing? No thanks, bud, I think I’m good just where I am.”
Would love to know what dad was doing for the company, say, eight years ago. Has he always been sitting back and doing nothing but drawing as an owner, or was he hands-on, in-the-trenches working side by side
It's a tax code violation to pay someone a salary for a job they don't actually have.
Going into business with a family member leads to the King Lear legend. I worked for my Mama in her business but only as a slave. Daddy wouldn't even touch her profits. Turns out she needed everything to pay for her assisted living.
His father owns 51% of the business. I'm sorry but that makes it HIS company, now the $20k per month is it salary or dividends? If salary then you can have ground to cut him off for not working there any more. But as majority share holder he could override it and remain in CEO position, so have to talk him into giving up the position and settle for the dividends, or sell off your share and set out on your own.
I'd like to hear how the "ashes" really worked. Who came into the business with what equity? It's important. It's easy to gloss it over and call it "the ashes".
This is why I will never work for a family company.
The first question is what does the operating agreement say? What does the buy-sell agreement look like? Owners are entitled to their percentage distribution of the profits. One solution if you're a manager per the operating agreement is to ensure there's no profit. This can be achieved by making investments in the business.
“Working with my dad making 20K a month but I want to kick him out because I am a greedy, ungrateful guy” there I fixed your title.
Exactly, I have little respect for this guy. But others may have all the respect for him. Idc either way
It doesn’t sound like that at all. Sounds like dad was better at producing revenue then running a company. Now that he is not producing revenue his compensated value is likely above his ownership value. If there is not enough profits for him to live on (distribution only) then he needs to come back or sell his equity position.
@@flybyav8tor dad is the principal owner. He sets the rule. He could fire the son and promote the next guy up all the same if he wanted
Dad's not working.
He's expecting his son to fund his retirement for the rest of his life.
If I were the son, I wouldn't have set up such a terrible business partnership.
If I were in his situation, I'd be stockpiling cash. I'd stop trying to grow the business at all. I'd get ready to buy dad out. Instead of growing the partnership business. I'd start my own side business offering other services. If he refused a reasonable buy out. The partnership would get the bare minimum to keep it running and I would focus on my business. Once my business exceeds Dad's. I would offer him another buyout and just stop participating after that.
Dad and I can both pull salaries for doing nothing. I'll focus on my own thing.
@@getinthespace7715 dad doesn't need to work when it's HIS company. He also he zero obligation to sell. Son doesn't like it then he can leave And start his own business
Is there a written contract? That’s where they need to look first.
Question, say this is an S-Corp. How does that work? As my understanding is owners/shareholders must pay themselves a reasonable salary? So, the father can not work for them anymore (no salary or wage or FICA) but get his cut of the dividends at the end of the year of whatever profit is left, 51%, right? And he's fine doing that without paying himself a salary? That's not against tax law?
We have the same problem. Owners working the business are not being paid as employees while other owners do nothing and make the same. Fast track to family problems and resentments.
If I'm 51 percent of a company, nobody before me is going to be CEO.
51 PERCENT!
I lived through this, 3 generation business. I'm the third one. The only way we got rid of the older generation was when they died. Needless to say my kids weren't allowed to enter the business.
I bet de-watering businesses do very well in a place like Seattle.
$3million company? Remember in the '60s 25cents then was worth $2 now.
They are paying him a salary as a tax shield for the business vs a distribution.
It sounds like your father started the business and you owe him everything you have.
Sounds like dads of old wanted cheap free labor out of their children!
Greed ruins even the best of us.
He’s been operating the business the last 5 years wtf are you talking about
@@aleffel9668still, dad needs to rest and that lay is pretty much his retirement
I’m with the father.
Sounds like he’s about 50 years old his dad around 80 and his father knocking at death’s door. WOW
Dave what
If one of your kid or kids wanted you out??
its literally called DAVE Ramsey show LOL
The real question here is: What if dad says no? As the majority owner he CAN say no.
And the answer at that point has to be scorched earth. I'm going to stop acting as a CEO, and since you're not acting as a CEO, no one will run the business, and it will fall apart. I'm going to start up a NEW business WITHOUT you, offer all our current employees jobs at their current pay or better, and then you get nothing but 51% of the old company's assets after the liabilities are paid.
Ownership of a successful business comes with reaping at least part of the profits. Otherwise, there is no point in risking a small business venture. I don’t know the full situation, but at first pass it sounds like the son is ungrateful for the work his father put into the business when he started it and possibly when it was struggling.
It’s actually very sad heading a son want to boot his own father out so he can make all the profit.
Growing up my father had a small lawn care business and I ran 80% of the operations and he got the profits. I took a lot of pride into making sure my father could sit back and relax and trust me to run things. He worked his ass off raising me, it was the least I could do.
I just can’t believe greed had come between this son and his own dad.
The way it should work is that the guy who works the business gets a salary, funds should be held back to grow the business aka reinvestment into the business to buy more equipment, supplies, get more employees if needed etc. Then after all of that is done profit should be distributed to the owners. Profit is always supposed to be the last paid. to do otherwise is skimming of the top and in a publicly traded company would be illegal. It also kills a company.
Now if the money taken off the top is to buy out a partner. Then that is an allowable expense. BUT it has and end to it or a diminishing balance that will hit zero at some point.
The father probably feels entitled to the money because he put up a good deal of the money to start the business. The thing is if you make that kind of an investment in the normal world, you get paid in dividends on profit after all the bills are paid, not before the bills are paid.
Team dad
Seems really weird to me how everyone is praising Dave's expertise here. Upon hearing the arrangement presented by the son the first question almost everyone here wants to know is Why is the original arrangement for 51%\49% split? So odd why Dave doesnt even ask this question as it would clear up quite a few missing details.
Going into business with friends or family is generally a bad idea
you trying to get more out of your dad. Shameful AF
I dont even understand how the Dad ended up with a salary vs profits as an owner.