Sample alignment. The people and the studio are fictional.
Two partners, one studio, three surprises.
Priya runs design and production. Marcus runs clients and new business. They were merging their freelance work into one design studio and assumed an even split covered it. Here's what happened when they each answered on their own.
What they each wrote, separately
- Ownership
- Priya: Even split. We’re equals.
- Marcus: Even split. We’re equals.
- Paying ourselves
- Priya: A monthly draw from day one. I have a mortgage.
- Marcus: No draws until we have six months of runway. Profit split at year end.
- Clients we bring in
- Priya: Every client is a studio client from the day we sign.
- Marcus: My two current retainers stay mine until they renew. New work is the studio’s.
- Time commitment
- Priya: Full time, around 45 hours a week.
- Marcus: Full time, though I’m finishing one outside contract through March.
- Spending decisions
- Priya: Either of us can approve anything under $5,000.
- Marcus: Anything over $2,500 needs both of us.
- If one of us leaves
- Priya: The other buys out their share at an agreed valuation.
- Marcus: The other buys out their share at an agreed valuation.
What the comparison found
Neither partner saw the other's answers until both had submitted. Then they saw this together.
Where they already agree
- An even ownership split, with both partners treated as equals
- Both work on the studio full time
- A buyout at an agreed valuation if either partner leaves
Where they differ
- When the partners start getting paid, and how much
- Whether Marcus’s existing retainers belong to the studio
- The spending limit either partner can approve alone
Assumptions neither said out loud
- Priya assumes Marcus is fully available from day one. Marcus is planning to finish an outside contract first.
- Both assume “even split” settles compensation. Their answers show it doesn’t.
Topics they both skipped
- Who owns the templates and design systems each partner built before the studio
- What happens to the studio name and portfolio if the partnership ends
How they worked through it
They took the differences one at a time. For each one they looked at a few options, including ones neither of them had proposed, and chose together.
Paying ourselves
Options they weighed
- Monthly draw from day one
- No draws until six months of runway
- A smaller equal draw once three months of runway is in the bank
What they decided
Equal draws of $4,000 a month each, starting once the studio holds three months of operating costs. Remaining profit is split evenly each quarter.
Existing retainers
Options they weighed
- All clients move to the studio at signing
- Retainers stay with Marcus indefinitely
- Retainers move over at renewal, with credit for bringing them
What they decided
Marcus’s two retainers move to the studio when they renew. For their first year at the studio, Marcus gets 10% of their revenue as an origination credit.
Spending limit
Options they weighed
- $5,000 alone
- $2,500 alone
- $3,000 alone, with a shared monthly log
What they decided
Either partner can approve up to $3,000. Anything larger needs both. All spending goes in a shared log they review monthly.
The two skipped topics went through the same process. They also wrote down two questions for their lawyer: which entity type fits the studio, and how to paper the retainer transfer.
The brief they took to their lawyer
Both partners reviewed the same version and confirmed it. It's a record of what they agreed, written so their lawyer could turn it into the right documents.
Partnership brief
Kiln Studio, prepared for Priya and Marcus
- 1.
Ownership
Priya and Marcus each own 50% of the studio.
- 2.
Compensation
Equal monthly draws of $4,000 each, starting once the studio holds three months of operating costs. Remaining profit is split 50/50 quarterly.
- 3.
Client relationships
All new clients belong to the studio. Marcus’s two current retainers move to the studio at renewal, with a 10% origination credit to Marcus for their first year.
- 4.
Time commitment
Both partners work on the studio full time. Marcus completes his outside contract by March 31 and takes no new outside work.
- 5.
Spending authority
Either partner may approve spending up to $3,000. Larger commitments need both partners.
- 6.
Pre-existing work
Each partner keeps ownership of work created before the studio and grants the studio a free license to use it.
- 7.
Departure
A departing partner’s share is bought out at a valuation agreed by both partners. The studio name and portfolio stay with the studio.
This is a record of the partners' shared understanding. It is not legal advice and not a legally binding agreement. Review it with a qualified attorney before relying on it.
The other way this could have ended
Suppose Marcus wouldn't move on the retainers, and Priya couldn't go six months without pay. They'd have learned that before they signed a lease or hired anyone.
They might keep freelancing and send each other work. That's a good outcome too. They found the problem while it was still cheap.
Find out what you and your partner are actually agreeing to.