Starting a New Project with Mate - Should We Have a Formal Contract?

iamyour on 15/06/2017 - 12:04
Last edited 17/06/2017 - 10:31 by 1 other user

Guys, a couple weeks ago, I come out with an idea for a development project that might be useful in the future.
I invite one of my mate to help me build the project and I think two is better than one.
We are currently in the early stage where lots of research and discussion about the project.

Before we go any further steps, I am thinking to do a formal contract between both of us as we are the co-founder of the project. This is to prevent any of us to run away with the idea by himself.

Can anybody help me with this? or if anybody have this experience before, do you mind to give me some input?

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  tranter on 15/06/2017 - 14:18

  +3

  You need to share the project details here first before we can give you advice.

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  Almost Banned on 15/06/2017 - 14:28

  +1

  I think its a good idea to formalise your agreement before you go too far.
  Other than that, it will depend on what you want to do and what structure you want to use for it.

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  [Deactivated] on 15/06/2017 - 14:38

  +4

  Can anybody help me with this?

  A solicitor

  or if anybody have this experience before, do you mind to give me some input?

  I wouldn't spend any time/money on formal agreements at this stage. All you have is an idea. It might seem like it's worth a million dollars, it's not. It'll just slow you down.

  We are currently in the early stage where lots of research and discussion about the project.

  Wait until you have a working prototype, have incorporated a company or are looking for some funding.

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  TheBilly on 15/06/2017 - 16:00

  "Guys, a couple weeks ago, I come out with an idea for a development project that might be useful in the future."

  Are you talking property development? If so, talk to a solicitor and accountant.

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  horsome on 15/06/2017 - 23:03

  Just document the details if you're uneasy, if you get legal advice your project will be over budget before you even start.

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  jpl on 17/06/2017 - 16:49

  First of all, if you did not patent the idea, anyone can run away with your idea, during, while or after you launch.

  Secondly, it is best to draft a piece on agreement that you and your partner agree to, doesn't need to be done by a solicitor, state the share, who came out with the idea, who has the ultimate say. Ideally just form a Pty Ltd and have the shares properly distributed. Forming online for a Pty Ltd cost less than $500, but this will save you arguments and disputes when things goes too good or too bad.

  Also state, if one party decided to give up, what happen, and go through this as detail as possible with your partner. It's better to do it as early as possible than later.

  Trust me, even a simple colour code on your product website will end up in different opinions.