Structure things intelligently
Jeremy is a software developer who has the chance to start a side business with a co-worker. He asks Dave if this is okay while he and his wife are in Baby Step 2. Dave doesn't see a financial problem with this unique opportunity, but advises Jeremy to be careful how they set up the new venture.
QUESTION: Jeremy is a software developer in Fort Wayne, Indiana, who has an opportunity to start a side business with a senior developer at his company. Together, they would create applications for the legal community. Jeremy’s wife is an attorney, and together they decided there was a market for their ideas. He wants to know if starting a business is too much of a risk while they’re in Baby Step 2 and paying off debt.
ANSWER: I think it’s just your part-time, side job. That’s what it sounds like to me. You shouldn’t have to put a lot of money in this. It’s just the sweat of your brain, right?
The trick is I don’t want you to end up in a partnership if this thing works. That’s the only downside. So we’ve got to figure out how to structure this where you guys own different parts of it, and you’re just working together in more of a joint venture. And you can tell it’s a joint venture if you can take it back apart without a lot of pain.
That’s what I would aim at just in terms of structure looking forward. But in terms of can you do some side deals and create some apps and make some money? Sure! Absolutely, I would do that. Let’s just figure out how to structure it intelligently with your buddy so you don’t get pinched.