In principle, "fair" should take into consideration the level of risk they've taken on by investing in your company. The higher the risk of losing, the higher should be the reward. investing in the company. The other consideration is how much is the investment as a % of the value of the company. You should have at least an idea, even if it is biased as to how much your company is worth. If you watch SharkTank, you've seen the panel members will do a fast calculation of $Investment / %offered = $Total Value of Company.
Harry, I am assuming they are just investors then, is that correct?
Usually silent partners share on the profits of the business in direct proportion to their investment. Let's say if a silent partner contributes 10%, then he/she will receive 10% of the after tax profits of the company. On the other hand, active partners pay themselves a salary and share the profits according to the partnership agreement.
If they are true silent partners, there total percentage should be less than 40%. That way the people doing the day to day work keep control.
The initial partnership was equal. How ever it now will be restructured to be silent partners.
I think Neil is spot on. How much are they investing and how much risk are they taking? You have to decide if that investment is worth giving up a percentage of your business ownership. Shark Tank is a good show to watch.
It seems you are saying you bootsrapped the start, but now many folks are moving on right after the launch. If so how much they keep should be very small because most of the risk, and the hardest work is still there. I don't know how far you are or how profitable you think you might be, but consider a system where their share is proportional to the effort they made, in the total effort in the next year. After that, it should bottom out a few percent max. Silent partners a huge burden and they shouldn't expect to keep much if they can't stay and do the work.