"Is Expanding My Investment in a Physical Fitness Class a Good Idea?

[Elsa Manatad]

Two months ago, I initiated a Physical Fitness Class, which has quickly grown to 200 members. However, the revenue hasn't matched the growth rate. An experienced entrepreneur in the same field has offered a partnership, planning to invest $25,000 with a projected $50,000 profit. He has rejected larger offers and suggested I invest $5,000 for an 8-12% stake in the venture.

They uses a cost-free retail space and a reliable, but paid event venue and has 100 attendees weekly. Considering the investment size and projected returns, how should I structure my financial involvement to balance the potential risks and rewards? Also, how can we plan our finances considering the volatility between one stable venue and one that may not be as reliable?

Additionally, I proposed introducing new retail products, and the owner has offered me a 40% share in return for my expertise in retail. I'm thinking about negotiating for a 40% stake in the overall business or a portion of the revenue from new members. What strategies should I employ in these negotiations to ensure the partnership is equitable and beneficial for both parties?

I would appreciate any guidance on managing these types of financial partnerships and navigating a dynamic, competitive market.