I have a single member LLC. A friend of mine is pursuing a business venture and would like to bring me on as a 20% owner. He does not have a company formed yet. Is there a way I can organize this under my LLC and still allow him to own 80% of his venture or would it be better for him to found a new company and have my LLC as a 20% owner (instead of myself individually)? Thanks.

He should organize his own entity to do business and not mix his activity under your liability protection. You would then only be an investor and would not have your business at risk if his has a liability problem.

I agree with OldJack. I can't see any benefit to taking on the liability risk associated with his business. Doing so would subject you to his competency in running the business.

Thanks. The reason I was considering something like this is cause it would be easier for us to just go forward since I already have a business established. I don't really see the disadvantage as far as liability since we would still be an LLC.