Leveraging Early Equity Acquisition: A Guide for Risk-Free Wealth Growth in Business and Partnership
How You Can Use Equity in Businesses to Build Wealth and Acquire Amazing Relationships
How do you get rich in business without starting your own business?
Even though this is a business, entrepreneur publication—I want to talk to you guys about something that has made a lot of people wealthy.
We all know somebody starting a business, a brand, or even flirting with the idea of it.
I want you to imagine something…
You own a marketing company and you admit to advertise for your friends clothing brand in exchange for 2-15% equity in his company.
You help them with the service that you are already an expert at (you don’t have to be a marketing agency to know how to advertise well) and in return you get a split of their profit because you believe in their company.
Story time:
I am in this exact scenario right now.
And I’m not only excited because I think my friend is going to do well, I’m excited because…
I get to be a part of the brand
I get to help someone who is just starting
The potential for the passive income is attractive as hell
It will never hurt because I will only profit if they do well.
Since you are an equity holder in the company, you can also be a great motivator for them to do well so you can earn profit.
How can you do this?
It’s a term called “Sweat Equity”
There are three ways that give you an introduction.
This video also explains it perfectly:
As explained in the video, there are 3 ways that most people do to work for a cut of equity in a company:
Become an Advisor
Become an advisor for a sector of the company.
If you are an expert at sales, team building, brand building, graphic design, photography, anything… Then you can do this.
Sometimes to prove your value you may have to do this for free and earn the equity later, but it’s free experience, so why not?
Any company, especially startups would be glad to have an advisor of a specific sector because they don’t have to pay you… Their performance pays you.
There’s also something to keep in mind:
Your work time may be minimal.
What if you do this role for the company and you only have to show up to monthly or quarterly board meetings to consult the working teams of those sectors?
Become an Operations Assistant
Want to help a company grow instead of starting your own business?
Forced to go through all the marginal things that makes business ugly.
A lot of people get into business for the growth factor specifically, so this might be a better opportunity for many people.
“Sweat Equity”
So why aren’t more people doing it?
Many people are unaware a system like this exists.
It’s more opportunity for you to hop on the wave.
It’s simple, you assist with operations like marketing or developing a team for a certain sector, and you get a cut of equity.
Become Transaction Assistant
Other people may be skilled at helping somebody exit their business.
This might be a more specialized skill as you want to be experienced in finances.
But, it’s a way you can make money ON THE EXIT
It may be better to start with 1 or 2
Private Equity VS Real Estate
A lot of people think about what the better investment vehicle is.
It’s never bad to own a part of a business as we live in a capitalist country and the rate at which small businesses are being created increases every year.
That’s not to say you can’t own real estate as well.
Many people are familiar with Alex Hormozi’s statement of only investing in businesses because that’s what he knows best.
I encourage this as well, but I also love real estate and I think everyone should eventually get into real estate.
Even just a few rental properties.
Phantom Equity
Alex Hormozi is famous for talking about systems like this.
His $100mil company, Acquisition.com, is famous for holding equity in companies looking to scale past $10mil (Strategy #2).
Here is a video of Hormozi talking about a process to give employees equity in your company.
The more money I make other people, the more money I make
Resources:
Get Equity in Businesses By Consulting
I always give away equity in my companies... this is why..
How to Formally Enforce Equity in a Contract
Thank you for reading.
Come back next Friday where I talk about the ultimate freedom game and what my everyday looks like to grow my business, increase wealth, and live life on my terms.