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All of the things you've thought of for this reality check are correct.
Further, my impression is that "friend SME" is asking for a very large
chunk of the gross. On the whole, there is a lot of "hidden" costs to
this kind of effort, and 25% of the gross is too much. "Friend SME"
should be willing to work on a staggered rollout of the classes and
graduated gross receipts accordingly.
My impression is that you need to work for a company that is more
stable. This one appears on the service to be more of an "avocation"
than a true entrepreneurial effort. The owner is not being very
responsible in her approach. It is common for entrepreneurs to dream,
but dreaming has to be implemented in stages in order to make dreams
happen. As you rightfully point out, the company needs customers first.
There are really several small rules that should never be violated:
Don't divide the revenue before you get it.
Don't count on the internet to drive business to you. You have to drive
business to it. (My hit rate on closures on the internet is very good.
But I've spent nearly 3 years doing things that drive people to my web
site. My goal was to ensure it paid for itself. It has, plus more, but
it didn't in the first year.).
Don't discuss "shared profit" until you are sure there are profits to
share.
Don't ask friends like "friend SME" to work on a venture that is shaky
at best.
You sound as if you have a really good head on your shoulders. I'd
combine head and feet and get out of Dodge.
Sherry Michaels
Michaels & Associates, LLC
11639 E. Wethersfield Rd.
Scottsdale, AZ 85259
480-614-8440
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