Valuation of a company with irrelevant profit, but in a growing industry

What would be the best valuation structure for the company below?

The company is basically an offline retail company in a growing industry with high potential growth with the right online presence leveraging a few of the products they developed in China. The owner is 65+ years old and was not considering selling, but he is open to discussing it,

I am not interested in the offline retail business, but I am interested in the owner's knowledge and in his product distribution contracts. I see 2 deals options

• Option 1: Offer to buy the entire business with a low valuation but with a generous earn-out
• Option 2 (preferred): Launch the online arm of his business leveraging their current contracts and give him a small share of the business based on his knowledge/contribution and existing network. How to define his share?