Sweat Equity

定义

Sweat equity is ownership earned through work rather than cash: founders, early employees, and sometimes advisors or contractors compensated in shares for below-market pay.

它在融资中如何出现

Sweat equity is why vesting exists: contribution-based ownership must be earned over time, not granted permanently on day one.

常见问题

How is sweat equity valued?

By negotiation, usually referencing forgone market salary and risk; formalize it in shares with vesting rather than vague promises.

Can contractors be paid in equity?

Yes, with proper agreements and IP assignment; loose equity-for-work arrangements are a classic diligence problem later.

运用此术语

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