Is it possible to exchange professional services for a share in a company?

Question

Lets say for example, I am a Web Designer. Can I offer my services for "free" and just take a certain cut of the profits that company makes.

This could either be a "one off" design, or a "ongoing" deal where I manage their site.

Is any of this possible? Does this already happen? Who would I talk to about setting this up if it is possible?

Answer 1

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It is certainly possible and I've heard of it being done for web design but it's more common for professional services (i.e. the legal work necessary for a start up).

That said, as an entrepreneur I would never make this deal. These services are fairly inexpensive in the scheme of a start up while what you're potentially giving away is huge. If you really believe in your start up idea wouldn't you rather pay the cash and keep the stock?

I think this makes the most sense for you when you have the time available and the firm will only pay in stock rather than cash.