Partnership
The attorney explained to Alvin that a partnership might be of interest to him. A partnership is a business owned by two or more people. One major advantage of a partnership is funding. Each owner can help with financing, start-up costs, or ongoing business expenses. Another advantage is shared knowledge and experience. In Alvin's case, he's good at making the widget, however, if he had a partner, his partner may have excellent selling and marketing skills to promote the widget.
However, one main disadvantage is that Alvin would need to share any profit with his partner. The percentage split would be agreed upon by each partner or may equal a percentage of what they put in to start the business. This same percentage would be applied if the business were sued; each partner would be liable to the percentage of ownership. Starting a corporation solves the personal liability issue of a sole proprietor and partnership.