Utilizing Multiple Investors

[Clint W.]

Hello all,

I have dug around for a bit, but I can't seem to find what I am looking for. 

My business partner and I have had a good run on joint purchases and solo purchases; however, we have reached the limits of our resources.  We are starting to accept that we can't expand much further without outside support.  We have had multiple friends and associates offer to help us with investments, but until now, we have stayed away from them.  We wanted to gain the experience and knowledge to be good stewards of their investments.

One of our biggest questions now, is how do we proceed?  We don't necessarily want loans with structured interest and returns.  We want to pursue an investment mentality.  You succeed if we succeed.  We have been discussing this, and what we think is that the returns are split via investment percentage (e.g. If you invest 5% you get 5% of the profits).  Does that make sense (it does to us)?   Is there a better way to involve people as investors?  What kind of contracts should we have?  How do we protect ourselves from retribution, if the investment is bad?

I'm not sure this is in the best forum, but I can always move it.

Cheers,

Clint