Unless you need it for a portfolio item or this website has a clear business plan in a market where you are guaranteed a lot of traffic, don't work for ad space. Unless the other person has a proven track record of revenue producing sites, you're essentially working for free. It's spec work. Some things you need to ask yourself:
- What is my hourly wage?
- How many hours will I work?
- Is the site likely to receive my
hourly wage x hours worked in ad
- What is the marketing plan for the
- Is the sole purpose of the website to
get revenue from Google AdSense? (It
will fail, if it is.)
- Is the target market of the website
likely to click on ads?
I'm sorry to word this so strongly, but I see far too many developers falling for this type of "business deal". If they don't think enough of their idea to pay you, you will never see any revenue from the ads, at least not enough to cover your expenses. What is the risk of the other party? You're putting in your time, what are they doing? And if it fails, who bears the brunt of the cost?
Some people genuinely don't have the money to pay for something, but if they can't manage their personal finances, it leaves me with little faith they will be able to run a business well.
If I were you, I would either:
A) Ask for money up front and don't budge from that position. Don't take potential ad revenue from something unproven.
B) You have the skills to create a website. Why not create one for yourself and earn all the ad revenue from that website rather than relying on a piece of someone else's pie that has yet to be baked?