LifeinAsia - 8:41 pm on Jul 23, 2009 (gmt 0)

Anything short of setting up a legal Partnership is just setting yourself (and them) up for trouble later on. The terms of the Partnership should explicitly state ownership, compensation, etc. of all partners.

One way of figuring out equity distribution in the setup phase is to price out the e-commerce project as if you were building it for a client. Compare that "cost" against whatever money they have already put into the project, and that will give all of you a starting point for negotiations.

As far as what's a fair percentage of sales? I don't have an answer for that. That's most likely something you'll have to negotiate with them and come to some sort of trade-off between higher equity or higher percentage of sales.