# Claiming profit

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Hi. Our team thinks about developing a game. It would be an episodic story driven game. I developed a story. How much percent of profit do you think I should claim? Given that each person invests the same amount of money into the project and team members are 5. Thanks

Edited by Roundsquare

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That depends on so many things. Are you planning on making the next candy crush? Then you could expect billions.

What you should do is take a look at what similar games or companies did, who they marketed too, and how much they may have profited, to get an idea

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What if I'd ask about the percents of the profit sharing? Would this question make  more sense?

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Both the original and current form of your question make sense, that's not the issue. The issue is that figuring out who is owed what compensation is a complex process that you will mostly have to work out among the five of you, because it depends on a ton of factors.

Without knowing anything else about you or your team or your project, it seems to me that if there are five of you and you each contributed equally to the company to start with, you should each expect 20% of the company's profits.

But you are free to structure the ownership of your company and its distribution of profit and loss however you like, subject to the overarching laws of your jurisdiction. The important part is to make sure this is documented, in writing, and signed off by all parties, before you start anything. Ideally this should have already been done as part of the formulation of your company.

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"Profit sharing" is a common novice mistake, and it doesn't work. If you're heading the project, pay everyone in your team an hourly rate as they do the work. Make it your responsibility to cover that cost, not theirs.

If you don't have enough money to do this, either downsize your team to something you can afford, find investors, or use crowdfunding.

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As part of your agreements, such as a collaboration agreement or parntership agreement or articles of incorporation, you'll describe how that works.

The "profit sharing" many beginners want to do is a terrible model.  Models that distribute equity based on contributions are also bad ideas.

Instead if you all want to be co-owners of the company, or co-owners of the collaboration, that would accomplish basically the same thing because you each have equal equity.  Anyone can buy out their portion of the collaboration using that.  However, even that is often a bad idea.

The best option (from a logistical perspective) is to make everything discretionary with the principal people making that decision.  If you can't agree then the money sticks around. If they agree that a person had minimal contributions and doesn't deserve an equal share they can decide at that moment.  Even better, it doesn't stick around forever; if someone sends you $5 for your game twenty years from now, you don't need to track down all five people who have lost track of each other and give them each their$1.

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I agree with the comments left here so far. If possible you should ¨buy out¨the others or looks for collaborators you can pay a salary or wage to. Perhaps look for an investor if you are unable to front the money to do this work, but it sounds like you are cutting the pie in many pieces.

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