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Should I be a minority owner in a company?
What should you do if your friend or anyone asks you to be part of their company, but only as a minority owner of the company or LLC? If you agree, you should require that you also be a member of the board of directors or a manager in an LLC; otherwise, your investment can be at risk. A minority owner cannot demand any return on its investment because the majority shareholder or member can take high salaries and bonuses, leaving no “profit” to be split among the owners. The majority owner taking high salaries and leaving little or no money for profits to go to the minority owner is the most common dispute in friendships that Badeaux & Associates sees.
