Strategies for bringing on a junior partner?
I am closing on the purchase of my third fix-and-flip this month (I also have one rental). I have had a builder/carpenter/handyman who I like a ton working with me the last 6 months. He is awesome and I would love to keep him with me for the long term, particularly as I scale up to doing more ambitious/complex projects. Anyone have experience bringing on such a person as a junior partner in some form -- for instance giving him a little sliver of equity in a deal, or agree to a profit share (e.g. 5% of profit) on a deal. Or full-on partnership in everything I do in REI, I guess. I would need to pay him his hourly rate regardless (he has a young family and his wife recently quit her job to stay home with a baby). I'm looking to incentivize him, encourage him to take more leadership in project management, align interests and keep him around for the long term.
Background: My first deal I made $210K pretax profit on $225K all-in investment, second one made $72K on $233 all-in. Next project will require ~$650K in investment, expect to make $200K+ in profit. I am providing all the financing, sourcing the deals and providing some sweat equity. Potential partner is labor, doesn't have $ nor tons of business acumen, but he's a great worker, has good judgement, ambitious, etc.
Thanks for any and all ideas!