If you have a business idea that you want to put in motion an need financial backing, one of the possibilities for you is a limited partner. You run all the day to day business while the limited partner does not participate in this. There is a contract set up between you, the general partner, and the limited partner that states what limitations that are placed on a limited partner.
The main advantage of a having a limited partner involved in your business is this will help with your business finance. The profit is split equally in most partnerships unless otherwise specified in the contract. One disadvantage is only the general partners are held liable for all the business transactions. By law the personal property of the limited partner can not be touched. This will help in the process of getting a limited partner, because they know they will not be held accountable for any losses. If you choose to have more than one limited partners than you can.
You present the business idea to the prospects and they decide whether they want to invest in your idea. If they decide to make the investment, then a contract is written up for you both to agree with. The limited partners get the convenience of not having to worry about what operations need to be done on a day to day basis. This can be a wise and logical choice for all members involved in the business.
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