Starting a business at work
Discussion
This is all very complicated so I'll try my best to keep it simple!
Boss doesn't want the fuss of buying a new machine, I want to buy the machine, rent a bit of space off him, then run it part time while slowly building up my own business.
He seems to be fine with the idea as long as there is no major reason not to.
No real idea how it would all work out yet, but is there any obvious legal reasons not to do something like this?
It would suit me in so many ways, no real downsides as far as I can see, I had been planning to setup at home.
It's not quite as obvious what the upsides are for him, and the potential downsides could get complicated. But mainly it would keep me there (Been there over 10 years, so handy to have round!) and shut me up! Obviously he would have access to new machine and would allow him to take on more work too. Would also free up my current machine for more suitable work.
I really need the new machine (and all the stuff that comes with it) to keep my skills up to date.
Boss doesn't want the fuss of buying a new machine, I want to buy the machine, rent a bit of space off him, then run it part time while slowly building up my own business.
He seems to be fine with the idea as long as there is no major reason not to.
No real idea how it would all work out yet, but is there any obvious legal reasons not to do something like this?
It would suit me in so many ways, no real downsides as far as I can see, I had been planning to setup at home.
It's not quite as obvious what the upsides are for him, and the potential downsides could get complicated. But mainly it would keep me there (Been there over 10 years, so handy to have round!) and shut me up! Obviously he would have access to new machine and would allow him to take on more work too. Would also free up my current machine for more suitable work.
I really need the new machine (and all the stuff that comes with it) to keep my skills up to date.
Edited by DRCAGE on Tuesday 6th November 18:29
Doesn't sound like a great idea to me. Potential to get pretty messy.
First why pay him for space when a) you won't have any income to start with and b) he'll be getting use of the machine?
Second, whose work gets priority? It's his space, your machine, he pays your wages...
Third, and maybe most importantly, why would an employer want their employee to 'build up' a business which if successful is inevitably going to take the employee's attention away from the main business, either temporarily or permanently? And that's assuming it's not even a direct competitor.
I can't see the benefit for him. Which could mean he doesn't really care, or he's got some ulterior motive. Neither bode well for the future.
The standard approach here is to do the thing on your own time (and space in this case) and get to a stage where you can leave the job with a clean break.
First why pay him for space when a) you won't have any income to start with and b) he'll be getting use of the machine?
Second, whose work gets priority? It's his space, your machine, he pays your wages...
Third, and maybe most importantly, why would an employer want their employee to 'build up' a business which if successful is inevitably going to take the employee's attention away from the main business, either temporarily or permanently? And that's assuming it's not even a direct competitor.
I can't see the benefit for him. Which could mean he doesn't really care, or he's got some ulterior motive. Neither bode well for the future.
The standard approach here is to do the thing on your own time (and space in this case) and get to a stage where you can leave the job with a clean break.
DRCAGE said:
This is all very complicated so I'll try my best to keep it simple!
Boss doesn't want the fuss of buying a new machine, I want to buy the machine, rent a bit of space off him, then run it part time while slowly building up my own business.
He seems to be fine with the idea as long as there is no major reason not to.
No real idea how it would all work out yet, but is there any obvious legal reasons not to do something like this?
It would suit me in so many ways, no real downsides as far as I can see, I had been planning to setup at home.
It's not quite as obvious what the upsides are for him, and the potential downsides could get complicated. But mainly it would keep me there (Been there over 10 years, so handy to have round!) and shut me up! Obviously he would have access to new machine and would allow him to take on more work too. Would also free up my current machine for more suitable work.
I really need the new machine (and all the stuff that comes with it) to keep my skills up to date.
No legal reason why you couldn’t do it. However just a risk that it might get all messy.Boss doesn't want the fuss of buying a new machine, I want to buy the machine, rent a bit of space off him, then run it part time while slowly building up my own business.
He seems to be fine with the idea as long as there is no major reason not to.
No real idea how it would all work out yet, but is there any obvious legal reasons not to do something like this?
It would suit me in so many ways, no real downsides as far as I can see, I had been planning to setup at home.
It's not quite as obvious what the upsides are for him, and the potential downsides could get complicated. But mainly it would keep me there (Been there over 10 years, so handy to have round!) and shut me up! Obviously he would have access to new machine and would allow him to take on more work too. Would also free up my current machine for more suitable work.
I really need the new machine (and all the stuff that comes with it) to keep my skills up to date.
Edited by DRCAGE on Tuesday 6th November 18:29
Worst case scenario - If you and your boss fall out could you literally pick up the machine and walk out, or would you need to get permission from him to access the office and relocate the machine?
technodup said:
Doesn't sound like a great idea to me. Potential to get pretty messy.
First why pay him for space when a) you won't have any income to start with and b) he'll be getting use of the machine?
Second, whose work gets priority? It's his space, your machine, he pays your wages...
I'm only there 3 days a week atm (ETA currently temping 2 days a week somewhere else, hopefully replace those 2 days with my own work), so I guess on "my" days my work gets priority, but yes, all a bit awkward. The nature of the work is everyone wants their stuff yesterday, so if there is something important then getting work off him shouldn't be a problem.
Third, and maybe most importantly, why would an employer want their employee to 'build up' a business which if successful is inevitably going to take the employee's attention away from the main business, either temporarily or permanently? And that's assuming it's not even a direct competitor.
If he doesn't want to get the machine himself, and he doesn't want to let me do this then I'll have to go elsewhere, which he doesn't seem to want.
The business is engineering/CNC machining, the new machine is a different enough that it allows new/different work.
I can't see the benefit for him. Which could mean he doesn't really care, or he's got some ulterior motive. Neither bode well for the future.
Main benefit for him seems to be my last point (I will leave), he is a unique character and doesn't really seem to care about anything! Seems stupid to say, but I really can't see any sneaky ulterior motives or anything too scary.
The standard approach here is to do the thing on your own time (and space in this case) and get to a stage where you can leave the job with a clean break.
I don't want to leave the job, the 3 days a week I do there covers my normal bills etc I guess in a perfect world I would do 3 days for him then 3 days for me. I want to specialise in more complex work and feels this way I can be a bit fussier, no need to take on work just to keep busy.
Thanks for the reply! My bold.First why pay him for space when a) you won't have any income to start with and b) he'll be getting use of the machine?
Second, whose work gets priority? It's his space, your machine, he pays your wages...
I'm only there 3 days a week atm (ETA currently temping 2 days a week somewhere else, hopefully replace those 2 days with my own work), so I guess on "my" days my work gets priority, but yes, all a bit awkward. The nature of the work is everyone wants their stuff yesterday, so if there is something important then getting work off him shouldn't be a problem.
Third, and maybe most importantly, why would an employer want their employee to 'build up' a business which if successful is inevitably going to take the employee's attention away from the main business, either temporarily or permanently? And that's assuming it's not even a direct competitor.
If he doesn't want to get the machine himself, and he doesn't want to let me do this then I'll have to go elsewhere, which he doesn't seem to want.
The business is engineering/CNC machining, the new machine is a different enough that it allows new/different work.
I can't see the benefit for him. Which could mean he doesn't really care, or he's got some ulterior motive. Neither bode well for the future.
Main benefit for him seems to be my last point (I will leave), he is a unique character and doesn't really seem to care about anything! Seems stupid to say, but I really can't see any sneaky ulterior motives or anything too scary.
The standard approach here is to do the thing on your own time (and space in this case) and get to a stage where you can leave the job with a clean break.
I don't want to leave the job, the 3 days a week I do there covers my normal bills etc I guess in a perfect world I would do 3 days for him then 3 days for me. I want to specialise in more complex work and feels this way I can be a bit fussier, no need to take on work just to keep busy.
Edited by DRCAGE on Wednesday 7th November 07:43
NDA said:
Why don't you set up on your own and have the new machine in your garage at home - or in your own premises somehow?
New machine is just too big for at home, If I do end up at home it'll be a smaller/different machine, but that has been the plan for the last few months and will most probably be what actually happens. To start up in my own premises is too scary/risky! And if I can be picky with the work like I mentioned in other reply it could be perfect for me.
Work that your current company can't do because of the lack of a machine, becomes your work.
I'm hoping this will happen regardless of where the machine ends up!
New machine is just too big for at home, If I do end up at home it'll be a smaller/different machine, but that has been the plan for the last few months and will most probably be what actually happens. To start up in my own premises is too scary/risky! And if I can be picky with the work like I mentioned in other reply it could be perfect for me.
Work that your current company can't do because of the lack of a machine, becomes your work.
I'm hoping this will happen regardless of where the machine ends up!
Countdown said:
No legal reason why you couldn’t do it. However just a risk that it might get all messy.
Worst case scenario - If you and your boss fall out could you literally pick up the machine and walk out, or would you need to get permission from him to access the office and relocate the machine?
Would need permission should the worst happen, but if it came to that I'm sure we would go our own ways without causing too much grief to the other guy.Worst case scenario - If you and your boss fall out could you literally pick up the machine and walk out, or would you need to get permission from him to access the office and relocate the machine?
If its a guy you know and trust I would say it's a great opportunity.
Make sure you document your understanding of the arrangement and get him to agree to it.
Then if things go wrong you have something to go on.
He will effectively be granting you a licence to use his space, it would be best to have this documented too, to protect both of you.
Have you also considered things like VAT, incorporation etc. CNC machines can get pretty expensive so VAT may be a consideration.
Make sure you document your understanding of the arrangement and get him to agree to it.
Then if things go wrong you have something to go on.
He will effectively be granting you a licence to use his space, it would be best to have this documented too, to protect both of you.
Have you also considered things like VAT, incorporation etc. CNC machines can get pretty expensive so VAT may be a consideration.
It sounds like you are on the verge of starting on your own - and you probably should.
I don't know the economics of your particular business, but assuming the machine would pay for itself then you should seriously consider it. And you would definitely need to detach this new business from your current employer.
I would offer him commission on the work he passes to your new business - win win for him to earn from work he currently declines.
I don't know the economics of your particular business, but assuming the machine would pay for itself then you should seriously consider it. And you would definitely need to detach this new business from your current employer.
I would offer him commission on the work he passes to your new business - win win for him to earn from work he currently declines.
I should have said in the OP, we are a tiny business (only 3 full time including the boss), in a rented barn from a local farmer.
I don't want to partner up with the boss (Sounds too complicated, and while we work well together, we are also very different!)
The most convenient space is an 11m^2 area (currently filled with crap, easily recovered with a good tidy up) and I can fit everything I need in there. This is less than 10% of current rented space.
I don't want to partner up with the boss (Sounds too complicated, and while we work well together, we are also very different!)
The most convenient space is an 11m^2 area (currently filled with crap, easily recovered with a good tidy up) and I can fit everything I need in there. This is less than 10% of current rented space.
Don't disagree with the notes of concern raised by others but this could be a nice little deal for you if it's worked right. I did a similar thing many years ago helping me transition between an employed Graphic Designer, Freelancer to setting up my own agency.
The reason your boss seems happy with the idea is that he will get an added resource without him having to finance it. He wont make as much but the risk is lessened so it evens itself out.
Much hinges on wether you trust your boss and if the figures stack up from your side of things.
The reason your boss seems happy with the idea is that he will get an added resource without him having to finance it. He wont make as much but the risk is lessened so it evens itself out.
Much hinges on wether you trust your boss and if the figures stack up from your side of things.
springfan62 said:
If its a guy you know and trust I would say it's a great opportunity.
Make sure you document your understanding of the arrangement and get him to agree to it.
Then if things go wrong you have something to go on.
He will effectively be granting you a licence to use his space, it would be best to have this documented too, to protect both of you.
Have you also considered things like VAT, incorporation etc. CNC machines can get pretty expensive so VAT may be a consideration.
I think he would most probably do it all just by word if it was up to him! But I'm the opposite and need to see it all written down, so yes it'll all be set out very clear before anything happens. I do trust him, and while I'm sure things could get awkward/complicated I truly don't think it would get any worse than that.Make sure you document your understanding of the arrangement and get him to agree to it.
Then if things go wrong you have something to go on.
He will effectively be granting you a licence to use his space, it would be best to have this documented too, to protect both of you.
Have you also considered things like VAT, incorporation etc. CNC machines can get pretty expensive so VAT may be a consideration.
And of course taxes, the plan is to go incorporated as my own little business as soon as needed. Seems easy enough to do the early/basic legal side of things. Been messing round making a website last couple of months, reading loads of stuff about insurance etc.
DRCAGE said:
Main benefit for him seems to be my last point (I will leave), he is a unique character and doesn't really seem to care about anything! Seems stupid to say, but I really can't see any sneaky ulterior motives or anything too scary.
I'd be concerned if he truly doesn't care. Not just because it's a pretty odd way to run a business, but how things could change, e.g. him just deciding to shut up shop one day. Where are you then, with no job AND your machine stuck in his place?Don't underestimate how money changes things, and especially people. He might suddenly care if he sees himself 'losing' money because you're doing private work.
DRCAGE said:
I don't want to leave the job,
Keep it separate then. At the minute he's got most of the cards, he pays your wages, he's got the premises... and now you want to give him another by storing your expensive machine in his place.If this was one of my guys he'd be getting laughed at. And I'd be giving consideration to getting rid, because when he starts doing homers it's only a matter of time before he f
ks off anyway.You said it in the first line of your first post that it was complicated. Complicated goes wrong and costs everyone money and pain. Keep it simple. Separate. Or you'll be back here in a few months asking for advice on how to get your machine back.
Another potentially deal-breaking issue. If you are planning to put your plant in his space, how will the insurances work?
Imagine a fire caused either by your machine, or by your employer. What would the impact on either or both of you be? Ditto, say, an electrocution of a third party.
I'd imagine most underwriters would need to see a very clear written agreement and to understand the relationship between the risks they are being asked to cover and the existing insurances. This aspect could be quite messy, especially if you cannot hive off the relevant area completely and agree a designated area of his business exclusively for your use (in which case renting elsewhere might make just as much sense).
You would also need to explain access rights to the machine, right of entry/recovery to secure/remove the plant and any WIP and materials in the case of dispute, etc etc
EDIT - I see the same issue covered above as I was drafting my response.
Imagine a fire caused either by your machine, or by your employer. What would the impact on either or both of you be? Ditto, say, an electrocution of a third party.
I'd imagine most underwriters would need to see a very clear written agreement and to understand the relationship between the risks they are being asked to cover and the existing insurances. This aspect could be quite messy, especially if you cannot hive off the relevant area completely and agree a designated area of his business exclusively for your use (in which case renting elsewhere might make just as much sense).
You would also need to explain access rights to the machine, right of entry/recovery to secure/remove the plant and any WIP and materials in the case of dispute, etc etc
EDIT - I see the same issue covered above as I was drafting my response.
Considering your part time position, I'd be more inclined to keep things separate (as others have said) and house the expensive equipment at another location (e.g. your home). Create a business, sort the insurance and do all the necessary paperwork.
During busy occasions where your employer is unable to handle the workload, they can ship it out to you to complete on your days off. This money can then be used to promote your business, allowing you to take on your own clients. Slowly, you can distance yourself from your employer, to the point where he essentially becomes another client!
Hopefully you'll know the market/demand/finances etc.
During busy occasions where your employer is unable to handle the workload, they can ship it out to you to complete on your days off. This money can then be used to promote your business, allowing you to take on your own clients. Slowly, you can distance yourself from your employer, to the point where he essentially becomes another client!
Hopefully you'll know the market/demand/finances etc.
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