Brother-in-law wants a loan to start a home-based business. Please evaluate if his plan seems profitable?
My wife's brother has asked me for a loan to start a home-based business (with his wife also being involved). Can you please evaluate their plan? Metafilter probably has more per capita people who work from home or are self-employed, so I assume his plan will get a fair consideration. I will give them a printout of this thread so they can see a candid neutral perspective.
As I understand it, the business involves making transactions on Dubli by "clicking"
. And here
is a Youtube video giving their estimated earnings. Between the two of them, they plan to put in 40 hr/wk on this business.
The loaned money would let them "join" at certain financial tiers and cover the costs of training sessions plus equipment. Their plan is to repay the loan with interest at the end of two years.
What do people think of this business? Does it seem like something where they could have a reasonable expectation to gross $50k/yr during the next two years without additional expenditures?
Privately I calculate they would need to gross $50k/yr from their efforts in order to "break even". This assumes that instead of doing this business (and taking out a loan), one of them was a dedicated stay-at-home parent while the other worked 40 hr/wk for minimum wage (W2 employee).
I am aware of the standard advice about family, but I will be either be making the loan or offering 40 hr/wk work as an attendent in my car wash/laundry business. Either way I will not be supervising them, or interacting with them more than I currently do.