What Would You Do?

cdub

I agree with Day and Nick, partnerships are very tricky. Mine fell apart in three years. Everyone has made very good points so far, so all I can add is to consider what you bring to the table (like the ability to get profitable work, or maybe you're good at managing jobs). We know that your friend is bringing the money, which is hugely important. What you have to consider is how replacable what you bring is. If your just a good operator, then its highly replacable, but if you're an expert at doing tunnel bores and that's the work you're after, then I would say you're on an equal footing.

It's not much of a revelation, but what I'm saying is to approach your decision with some perspective.

__________________
"The beatings will continue until morale improves."

Cat385

Im not a fan of partners myself. I started 3 years ago with just a 3/4 ton pick up , 257 cat skid steer and myself. Now we have a 160 excavator,550 dozer, 257 skid, 07 sterling quad, 07 volvo quad, new shop and 4 guys. I'm not bragging at all but it just shows it can be done. I also quit a very good job to do this. It is a gamble. There is a lot more to it than you could ever imagine. I will be the first to say I miss the days when I could just bring my lunch and turn the key off at the end of the day and have no worries.
I wish you the best of luck.

Toolwh@#e

Dirt I agree with everyone when they say going into partnerships with friends is always very difficult. I've seen many friends go into buisness together only to fail and not be friends anymore.

However, years ago I had a very similiar oppurtunity. I was just a framing and light foundation contractor with a little experience as an operator. My best friend was a dump truck driver. We has talked for years about someday going into buisness together and we finally did. His dad was a mechanic with his own shop and wanted to retire and sell his buisness. When he sold the buisness he asked me to do the foundation and frame his new house. We all figured this would be a good time to go into buisness together so we would all get something out of it.

Thats what we did. We started out with a John Deere Excavator and a International dump truck and bought a flatbed and more concrete forms. His dad put up most of the money. We excavated the foundation for his dads new house, put in the foundation and framed it. As soon as we finished the excavation we had another excavation job lined up with another homebuilder. He found out we were a foundation contractor and a framing contractor and he ended up having us do the entire project for him. Years later we still do work for him. Our buisness took off and has been a nice success story and I'm proud that we made it work.

It wasn't without its hardships though. We did and still do have problems and arguments with each other, but we always work through it. It hasn't always been easy, it hasn't always been fun, but I am glad that we took the risk and became as successful as we are. Some of the major problems we had was when we hired his brother as an operator. His brother had problems for years holding down jobs. Mainly because he was just lazy. We had problems with him since day one and it caused us a lot of stress and aggravtion. We did eventually decide we had to fire him and it was a tough descision that did cause a lot of problems. In the end though we did eventually work it out.

We always tried really hard to work together. We always made a point to stay in constant communication with each other and to learn each others trade and side of the buisness. Now years later my partner probably knows as much about framing as I do, and I probably now as much about excavation and trucking as he does. But still we consult each other for major descisions. In a way to be honest it can be like walking on eggshells sometimes but it has all been worth it. Hopefully with our story you can see a nice pro instead of a con. Good luck with what ever you decide.

tnmtn

it sounds like the moneyman has quite a bit in assets sitting idle at his shop and will also need some excavation work through the year. maybe instead of partnership he would finance selling the equipment to you out right. now is not the time to sell equipment so it is definitly a buyers market. it seems you don't have much to loose but at the same time i would have to ask what he gains and if there is any way to work out another deal where both are happy and a partnership isn't needed. another possibility would be that he charge you for rental of his equipment and you start on your own.
good luck,

Dirt Pusher

Lots of good input guys, I appreciate it. Definitely some thinking ahead of me.

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Nothing Runs Like A Deere

denick

Pusher,

The other aspect to look at is the people involved and their personality.
People don't change!

The gentleman who is putting up the money is "successful" how did he get there? look at who and what they are now and their lives until now?

__________________
Nick

"Every day I remind myself that my inner and outer life are based on the labors of other men, living and dead, and that I must exert myself in order to give in the same measure as I have received and am still receiving" Albert Einstein

fireguy

I almost had a partner. He put up a piece of crap E350, I put up the other equipment, 30 years experience, the money, the customers. He wanted to hire under the table, work for cash, cheat on taxes. he challenged every thing I said, he challenged the attorney. He still kept wanting 50/50. I fired him. It took me 1.5 hours to remove everything from his van, and get it back in my van. I am not sure who was happier, me or my girlfriend. She was definatly not happy about hte partnership as I was really getting hard to live with.

Before getting married to this guy, both need to figure how the divorce will work. Each of you need to get a business attorny, get a credit report on each other, and write down your expectations. Good luck.

ElIngeniero

Most of the responses here are pretty similar and I must say that I agree with them wholeheartedly. One question I have for everyone, just out of curiosity, how did you finance yourself & your company in the beginning? Did you rent or just save through the years to buy your own?

My dad's father-in-law helped him buy an old, worn out backhoe at an auction and my dad began digging footings. After a few years, he developed a great reputation and began fine grading, digging footings, and doing a lot of masonry work. He then was allowed an opportunity to begin a rather large subdivision and so he bought a number of machines and got into dirtwork 20+ years ago.

cdub

I borrowed money from the bank, bought a cheap 953 a cheaper dump truck and a tag trailer. I worked lots of 80 hr weeks and had several strokes of huge luck. I've been liquid for years. Its funny to look back now and think how I scraped by on small cheap jobs with $2500 in my company account and still slept at night. I did the utilities on a very small subdivision for a guy I had dug some basements for. The engineer liked me and recommended me for a couple much larger ones and things just took off.

__________________
"The beatings will continue until morale improves."