Been watching suits lately and I’ve gotten to the point in season 6 where they use the buy in fund to finance a settlement, and overall I’m confused as to the idea of what a buy in is. They also mention concealing it from the partners who have left the firm, because if they found out the ex-partners would come gunning for their money. So, what is a buy in, and how does it work if you leave a firm after you’ve paid the buy in? Are you entitled to the money, or does it stay with the firm?
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Being a partner generally means instead of employee you are now a part owner of the firm and so you can get a % of the overall profits of the firm instead of just an annual salary.
Its kind of the same idea as buying stock in a company. A company is worth 100M and if I want to own 1% of it I need to pay a million dollars and buy 1% of shares.
Same thing for a partner, you are becoming a part owner of the firm, so you need to ‘buy’ that amount of equity.
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