Flat rate is good, keeps him motivated to make profits, but if he blows up and expands and is making 500x what he is making today, you take in nothing more.
Ultimately, as an entrepreneur you want to be attached to the success of a business, so the more the merrier. It has great potential for making lots of money in the future. If you stick him with a flat monthly rate and he has a few bad months he may be inclined to bounce.