In Affiliation, Legal
March 31, 2015
A shareholders’ agreement can prevent problems, but few gyms have one. How can they help CrossFit affiliate owners?
New CrossFit affiliate owners sometimes consider taking a partner at startup. The burden of labor and risk can be lightened when spread across several broad shoulders, and pooling funds means avoiding the moneylender.
But sometimes the coach’s vision doesn’t match that of the investor, or circumstances change quickly. Other times, deals are struck with friends, and more than money is lost if the partnership breaks up.
When Derrick Sims partnered with his longtime friend to open ECFF CrossFit in Pensacola, Florida, he believed his relationship was stronger than any legal agreement could be. A year later, he’s been through a bitter battle for his gym, and he’s facing the future alone.
Good coaches want to coach for a living, and many see partnership with an investor or friend as a shortcut to the entrepreneurial dream. And partnerships can work out for everyone involved if they’re set up well. But if proper care isn’t taken at the beginning of the relationship, even the best coach could find himself unhappy.
A solid partnership agreement can save money, lawyers and friendships, and creating one isn’t difficult or expensive.
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2 Comments on “The Best-Laid Plans”
1
Hilmar Dijkstra wrote …
A very true and wise article. Sadness is dripping off.
Many companies are build on emotions. There is nothing wrong with it, as long you are aware of that.
At the startup, many companies are build on investments by others.There is nothing wrong with it, as long as the participants are aware of their role.
Many companies start with two or even more people. They say they share the same dream or emotion, but in the hidden agenda is written "I need you for the investments, because I do not have enough money".
So, at the beginning, there is already a hidden conflict.
Sharing the results of hard training is easy. Sharing the thrilled emotions while starting up a gym is easy. Sharing the revenues is difficult.
Share the expectations honoustly at the start of the gym. Write them down and write down the consequences "if this .... than that".
This might be even harder and heavier than a WOD, but it will pay off.
Hilmar Dijkstra
CF L1 and lawyer
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2
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I believe this article could have been better served without the fictitious accounts of Michael Derrick Sims, owner of Emerald Coast Crossfit Functional Fitness in Pensacola, FL. All said information was of complete fallacy. Did Chris Cooper fact check? Check credibility? Anything of any sort in any realm of what is known as journalism??? It saddens me the Crossfit Journal stands behind and published such false nonsense without having gotten their facts checked and straightened out. I believe the first portion of this article relating to ECFF should be recanted. Immediately.
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