Article | Harvard Business Review | December 2012

How Much Is Sweat Equity Worth?

by Christopher Marquis and Joshua D. Margolis

Abstract

The article presents a case study of a business decision related to the valuing of sweat equity in a start-up business. One man starts a premium vodka business, bringing in his cousin at an early stage, but with no initial discussion of the eventual split of equity or managerial control between the two. The article offers each man's case for his ownership stake in a narrative style, and then presents various views of how and what they should decide.

Keywords: Valuation; Ownership Stake; Business Startups;

Citation:

Marquis, Christopher, and Joshua D. Margolis. "How Much Is Sweat Equity Worth?" R1212X. Harvard Business Review 90, no. 12 (December 2012).