Assuming we had cash in our startup. If one founder owns 70% and the other owns 20%, 10% is option pool. What is the ratio in which we can take cash out? The person owning the bigger chunk needs more cash.
Questions
Taking cash out
3 answers from the community
A· Sep 30, 2015
Um... Taking cash out (outside of salary) is a really bad idea. Why do they need that much cash?
A· Sep 30, 2015
You can do it as dividends. But unless you are an S Corp you get taxed twice which isn't a good thing.
A· Oct 5, 2015
If it's beyond agreed on salary, then make it a loan against owner's equity, dividends, profit sharing or whatever arrangement you have.
BTW, if one owner has 70% he/she can pretty much do whatever they want.