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What is the ratio of equity received for sweat equity vs. cash investment in a new venture?

Gust

There is no specific ratio between “sweat equity” and cash in a venture, and that’s actually not a good way to think about the issue. A better way to think about this is to separate two aspects of the “sweat” that one puts into a new venture. You might have created that value by slaving 18 hours a day, seven days a week for five years (in which case the value of the sweat equity is $8.70

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Should you include your sweat equity in a business plan?

Berkonomics

The post Should you include your sweat equity in a business plan? Investors love it when entrepreneurs draw little or no money from their startups.

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Marketing Sweat Equity: Getting Your Startup’s First Sales—Without Spending Money on Consultants and PR

Up and Running

After all, sweat equity can make up for a trim marketing budget, but it would be hard to make up for cuts in product development and customer service without sacrificing customer experience. Managing a Business Sales and Marketing bootstrapping marketing marketing tools sales startup sweat equityAccessing capital to launch a business is brutal for entrepreneurs just starting out along the path.

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What is Sweat Equity Worth?

www.entrepreneur.com

What is Sweat Equity Worth? Determining how to value sweat equity is key when negotiating with investors and employees. Entrepreneurs often ask me how to value the sweat equity invested in their startup. But over the years, I have come to realize that sweat equity isn't the same thing as market value for your startup. As the business owner, you should be the expert on valuing sweat equity, not your investors, accountants or lawyers.

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Building a sweat equity team

discuss.joelonsoftware.com

Part 1: Recruiting Part 2: Team Members Part 3: Environment Part 4: Schedules Part 5: Lifecycle Part 6: Design Moderators: Eric Sink SourceGear Bob Walsh Founder, StartupToDo.com Author of The Web Startup Success Guide and Micro-ISV: From Vision To Reality Patrick McKenzie Bingo Card Creator Andy Brice Successful Software Building a sweat equity team This post ends with this question: What are some good sources of information (books, forums, etc.)

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New on TNW Guides – How to Use Sweat Equity to Fund Your Startup [Sale Price]

The Next Web

Chances are, if you’ve not yet been in a position where you have to talk about splitting equity, you will be. How can you look at someone who comes on during year number two and say that they are entitled to anywhere near the same amount of equity as you have, after you’ve put blood, sweat and tears into your company? How to Use Sweat Equity to Fund Your Startup is the newest release on TNW Guides.

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How to Hire for Sweat Equity…

www.drowningamerican.com

Next → How to Hire for Sweat Equity…. That being said the following is available to the right candidate: • 3-5% equity in the company (based on experience). • $50,000/year salary once we obtain funding (target: January, 2010). And now I’m trying to get my own team, and have them work for equity. Pingback: How we Hire for Sweat Equity (Part 2)… « Drowning American. Drowning American. Musings on Life and the American Dream. Search.

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How we Hire for Sweat Equity (Part 2)…

www.drowningamerican.com

Next → How we Hire for Sweat Equity (Part 2)… Posted on April 7, 2011 by Travis Biziorek. equity in the company. Drowning American. Musings on Life and the American Dream. Search. Main menu. Skip to primary content. Skip to secondary content. Post navigation. ← Previous. The first time we hired partners for Kibin was way back in late 2009. You can read more about that here. It was a much different time then.

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Places to Find Developers in Exchange for Sweat Equity

www.askthevc.com

startupcto

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Maintain Your Startup Motivation While Working Harder

Startup Professionals Musings

That’s why all those so-called million dollar ideas I hear about as an investor don’t get me excited, and entrepreneurs find that working twenty hours a day often generates nothing more than sweat, instead of the desired sweat equity.

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8 Keys To Starting A Venture With Minimal Equity Loss

Startup Professionals Musings

With one of the many new tools , and a dose of sweat equity, you can create a website for almost nothing -- and you are on your way to success with ecommerce, your latest invention or personal services. Use your equity for key executives and business partners.

Equity 344
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8 Key Startup Drivers Bring Pleasure As Well As Sweat

Startup Professionals Musings

Those at the other extreme don’t look up from the grindstone long enough to notice whether all their work is producing sweat equity or just sweat. I’m fully convinced that both inspiration and perspiration are always required in a startup.

Startup 396
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Balance Your Focus Between Passion And Perspiration

Startup Professionals Musings

That’s why all those so-called million dollar ideas I hear about as an investor don’t get me excited, and entrepreneurs find that working twenty hours a day often generates nothing more than sweat, instead of the desired sweat equity.

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8 Red Flags To Evaluate Before Pledging To A Startup

Startup Professionals Musings

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment.

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7 Startup Partner Pairings That You Are Apt To Regret

Startup Professionals Musings

I’ll put in the money, if you put in the sweat equity.” Most entrepreneurs who start a company alone soon come to the conclusion that two heads are better than one – someone to share the workload, the hard decisions, costs, and tasks you don’t like.

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8 Questions You Should Ask Before You Join A Startup

Startup Professionals Musings

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment.

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8 Ways To Get Your Business Going Without Investors

Startup Professionals Musings

With one of the many new tools , and a dose of sweat equity, you can create a website for almost nothing -- and you are on your way to success with ecommerce, your latest invention or personal services. Use your equity for key executives and business partners.

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Equity-Only CTO and Equity-Only Developers

SoCal CTO

Understand where they were in terms of being able to pay or was this equity-only (sweat equity only). And he was still in the process of raising additional capital, so it was equity only. However, when I told him that the level of engagement required from me and the fact that equity-only development was required, he seemed to be a bit offended. There are cases where I will do equity-only deals.

Equity 241
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SmartHost of New York Wins the StartupBus 2014 Competition

SiliconHills

Sweat equity is the best startup capital” – Mark Cuban A banner bearing Cuban’s quote hung on the wall at Rackspace’s event center Thursday as it hosted its third annual StartupBus event featuring teams from all over the country and Mexico. All of the StartupBus participants riding on the eight buses for the past 72 […] The post SmartHost of New York Wins the StartupBus 2014 Competition appeared first on SiliconHills. San Antonio Rackspace SmartHost StartupBus

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8 Keys To A Major Source Of Funding For New Ventures

Startup Professionals Musings

The average amount per startup has been $23,000, usually in the form of a convertible loan, rather than an equity investment. Rather than set a fixed repayment schedule, tie investment payoffs to a percentage of new product revenue, or a plan to convert the debt to equity.

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How to Divide Founder Equity: 4 Criteria to Discuss

View from Seed

Editor’s note: Understanding how to divide founder equity at a startup can be tricky, even to the point of reaching emotional riffs between founders. Below, Lee Hower offers advice for approaching these equity discussions objectively and properly. As a result, one of the trickier things co-founders tackle is determining the equity split amongst the founding group of individuals. Sometimes co-founders put off the equity split question for some time.

Equity 315
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How Lemon Perfect Founder Yanni Hufnagel Hires the Best People

The Startup Magazine

Lemon Perfect’s success comes at a price: Hufnagel and his employees are willing to pay with sweat equity. Entrepreneur Yanni Hufnagel has cultivated a uniquely high-energy company culture at Lemon Perfect, the flavored lemon water brand he debuted in 2017.

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Equity for Early Employees in Early Stage Startups

SoCal CTO

I was asked by a reader how much equity he should give out to early employees and to service providers in a very early stage startup. Founders are likely not paid for a long time and have a sizeable equity percentage for early risk and having the concept. Early Employee Equity is an Art I somewhat agree with Fred Wilson in Employee Equity: How Much? Equity Formulas While it's somewhat an art, there has been a lot written about how you can look at equity compensation.

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This Is What You Can And Should Do When You Need Money

YoungUpstarts

Get Money With Home Equity Loans. A home equity loan gives someone money in exchange for the house as collateral. The amount of money available depends on the equity you’ve built. In fact, think of a home equity loan as a second mortgage.

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How To Enjoy Your Business Dream As Well As The Work

Startup Professionals Musings

That’s why all those so-called million dollar ideas I hear about as an investor don’t get me excited, and entrepreneurs find that working twenty hours a day often generates nothing more than sweat, instead of the desired sweat equity. At the same time, you can never let up on the work and the sweat required for continuous innovation, exemplary customer satisfaction, and staying ahead of competitors: Marketing is a never-ending challenge.

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5 Leadership Elements That Are Not Always About You

Startup Professionals Musings

You know how to bootstrap a business, build it from nothing, and burn sweat-equity for long hours to push your dreams to reality. Many entrepreneurs forget that their success is more about helping other people than about personally becoming famous, or overcoming the odds and getting rich. A successful business has to satisfy customers with a strong team, by helping them solve problems, save money, or experience more pleasure.

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Punch & Pie: How Should Co-Founders Divide Equity?

Agile VC

As a result, one of the trickier things co-founders tackle is determining the equity split amongst the founding group of individuals. Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits. Sometimes co-founders put off the equity split question for some time. Both of these are typically reflected in the founder equity split.

Equity 255
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Inspiration Without Perspiration is a Dull Startup

Startup Professionals Musings

Those at the other extreme don’t look up from the grindstone long enough to notice whether all their work is producing sweat equity or just sweat. I’m fully convinced that both inspiration and perspiration are always required in a startup. Yet many people seem to be stuck on one end or other of this equation – all perspiration with no dream, or all inspiration with no reality. Success is the right balance of both for fun and profit.

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Cheat Codes for Raising Capital from Venture Capitalists

David Teten

One or more of our past coworkers are joining us in this new business, and working for sweat equity.”. We love founder(s) who can say any of the following: Mindset .

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10 Answers That Make Your Startup Plan Investable

Startup Professionals Musings

How big is the funding request, and how much equity will you give? Quantify founder investments, both cash and sweat-equity. Entrepreneurs who are looking to attract investors need to develop and pitch a plan -- preferably written -- that answers every potential investor question about your startup before it is asked.

Startup 267
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7 Whirlwind New Venture Partner Marriages To Avoid

Startup Professionals Musings

I’ll put in the money, if you put in the sweat equity.” Image via Pixabay Most entrepreneurs who start a company alone soon come to the conclusion that two heads are better than one – someone to share the workload, the hard decisions, and the costs. In a moment of crisis, you may be tempted to take on the first person expressing interest as a co-founder. This would be a mistake, and could easily cost you your startup.

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5 Elements of Leadership You Can’t Succeed Without

Startup Professionals Musings

You know how to bootstrap a business, build it from nothing, and burn sweat-equity for long hours to push your dreams to reality. Many entrepreneurs forget that their success is more about helping other people than about personally becoming famous, or overcoming the odds and getting rich. A successful business has to satisfy customers with a strong team, by helping them solve problems, save money, or experience more pleasure.

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A Young Beginner’s Guide To Making Money Flipping Houses

YoungUpstarts

A lot of the profits from house flipping stem from sweat equity. Property is intrinsically linked to wealth. There’s a good chance most of your family’s net worth stems from the residential home. Businesses have made immense profits from repairing, selling, buying or renting out places to live. But could you actually make a decent profit flipping houses? Here’s what you need to know: Flipping. House flipping is a pretty simple business.

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5 Ways Entrepreneurs Help Others Succeed and Win

Startup Professionals Musings

You know how to bootstrap a business, build it from nothing, and burn sweat-equity for long hours to push your dreams to reality. Many entrepreneurs forget that their success is more about helping other people than about personally becoming famous, or overcoming the odds and getting rich. A successful business has to satisfy customers with a strong team, by helping them solve problems, save money, or experience more pleasure.

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Most Entrepreneurs Need to be Inspired to Perspire

Startup Professionals Musings

Those at the other extreme don’t look up from the grindstone long enough to notice whether all their work is producing sweat equity or just sweat. I’m fully convinced that both inspiration and perspiration are always required in a startup. Yet many people seem to be stuck on one end or other of this equation – all perspiration with no dream, or all inspiration with no reality. Success is the right balance of both for fun and profit.

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How Entrepreneurs Attract Friends, Family And Fools

Startup Professionals Musings

The average amount per startup was $23,000, usually in the form of a convertible loan, rather than an equity investment. Of course, most startups ultimately need much more than this amount to scale the business, but some prior contribution from friends and family (as well as your own sweat equity) is normally expected as a qualification before professional investors will consider entering the game.

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5 Elements Of Success Every Startup Should Celebrate

Startup Professionals Musings

That’s why all those so-called million dollar ideas I hear about as an investor don’t get me excited, and entrepreneurs find that working twenty hours a day often generates nothing more than sweat, instead of the desired sweat equity. At the same time, you can never let up on the work and the sweat required for continuous innovation, exemplary customer satisfaction, and staying ahead of competitors: Marketing is a never-ending challenge.

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8 Questions Before You Join Or Invest In A Startup

Startup Professionals Musings

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment. Every startup founder loves to prompt for questions from investors and potential key team members about their vision, and the huge opportunity that can be had with their disruptive technology.

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Carving Out Your Own Slice Of Heaven: 6 Ideas For Budding Hospitality Entrepreneurs

YoungUpstarts

Commit to plowing as much sweat equity as you can muster into your eventual choice. As the old saying goes, you have to spend money to make money. How much money you have to spend is another matter. There are literally dozens of low-cost business ideas available to entrepreneurs with a modicum of talent and ingenuity — reasonably low-hanging fruit that you can turn up in a matter of days or weeks. Starting a hospitality company is not such an idea.

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The Smartest Entrepreneurs Bootstrap Their Startup

Startup Professionals Musings

Yet, according to many sources , over 90 percent of all businesses are started and grown with no equity financing, and many others would have been better off without it. In fact, most of the rich entrepreneurs you know actively turned away early equity proposals. Too many founders are convinced they “need” equity financing, for the wrong reasons, as outlined in the book and supplemented with a bit of my own experience: Need employees and professional services.

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8 Key Questions To Expect In Investor Due Diligence

Startup Professionals Musings

The intent of this question is to determine the level of commitment of founders, both cash and “sweat equity,” and how much others have already invested into this plan. If you really want to impress a startup founder as a potential employee, or you want to be a smart investor, you need to know the right questions to ask.

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Punch & Pie: How Should Co-Founders Divide Equity?

Agile VC

As a result, one of the trickier things co-founders tackle is determining the equity split amongst the founding group of individuals. Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits. Sometimes co-founders put off the equity split question for some time. Both of these are typically reflected in the founder equity split.

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Why We Shouldn’t Be In Love With Startups 

ReadWriteStart

All while the majority of the economy is driven greatly by boring industries often owned by private equity, not venture capital. No, I prefer boring businesses and established companies that are not seeking their own sweat equity for services provided.