when it comes to getting paid we usually think of cash but what if i told you better yet what
if Beyonce told you equity could be an option to think about. News is that she was paid in
Uber stocks for a concert in 2015 and if she was paid in cash it would have been 6 million
but a couple of weeks ago uber went public on the stock market and the figure went higher but
is this something to consider here in Jamaica personal financial strategist Keneisha Mais is
here to break down the numbers good morning kenisha good morning thank you for having me
i know and i know beyonce um is the queen i was gonna say other people have done it but i
don't hear using miata because she's most popular because she also did it with coachella right she
did she did it with coachella know that netflix is showing it she's she's getting she licensed
her coach at a performance tonight so netflix so she's making money from that as well so um
talk to me about it because it sounds simple but it's not as simple
it it isn't um actually wanted to broaden the conversation a bit so last night i went
on social media and i asked some of my friends to you know share their insights and so i have
a few um comments right um so we did an instagram poll the sample size was 58 and 100
of the people said that they would take the equity versus the cash but then we had comments
from so we had kevran who said depends on your financial goals um equity cannot be
depends on your financial goals the equity cannot be used to purchase more equity but cash can
right so if you have cash and you can use that cash to purchase more equity in other companies
presnel said if it's a lump sum payment i'll take my chances because if the company is listed i can
invest any time i wish or use that money to start my own company which is also a consideration um
and then tremaine said it depends on each person's risk appetite so if the company is more mature
then take the equity otherwise take cash it also depends on your financial standing because it
might be nice exactly don't pay me you know give me some equity but if if gmbs are calling me for
their money exactly the first thing that's going to make the decision um say have money
for or let be like next week next month right so it depends you have to be in a position
where you can't take the equity versus the cash right so taking equity means that in the future
this is likely hopefully to be worth more but if you're not in that position if you're at the
start of your career then it may not be something that's really feasible for you right you may need
cash to get to your day-to-day living right if you do have some sort of lump sum some sort of
savings put aside somewhere then go ahead and take equity but one of the things that
you can also consider is taking a mixture of cash and equity so for example i have a
client who recently partnered with a company so she got an ownership stake in the company
and she provided her services to the company for free because sometimes when companies are reaching
out to people for they're offering them equities because they likely don't have the money to
afford their services right so they offer them some sort of equity in the company right
in you know in hopes that in the future it's worth more to the person so she took the the equity in
the company but what she also did was to negotiate profit sharing so that she can still have some
sort of financial gains right now right so that's also a consideration a mixture of cash and equity
the consideration would also be the nature of the company because you don't want to forego being
paid to um receive equity that's not going to have value exactly well so um what are some of the
likely to do something else right and we have many examples of this like instagram didn't start out
as instagram right and eventually the first the first iteration of that failed and then eventually
that team was able to create instagram and of course they did deliver value to their initial
investors so you have to look at the team behind the company because this is something that's key
and then you also have to look at if the company is funded in other ways who are the people or who
are the companies that are funding this company so for example if you have let's say you have
some fortune 500 type investors or some of the top tier investment firms if they're invested in
the company then it likely means that the company was vetted at a very high level and so you can be
guaranteed that you know what this company has a sound sound company behind them in terms of who
is investing and so this may be lucrative in the future um it's also i think assessing the value
of the equity and its equivalence to the service you're providing because um somebody can always
say i'm going to hire you for 300 000 so i'm going to give you equity in the company
at the value of 300 000 but but is the 300 thousand equity really worth 300 000 dollars
yeah um maybe maybe not like you say you have to assess the individual companies themselves
so for example you have companies here in jamaica who have listed on the stock market and they
started at let's say a dollar right their initial um starting price was a dollar but that stock
has declined to know maybe about 40 cents right right so that 300 000 that you put in is not 300
000 no right right and so this is something that you also have to take into consideration but like
i said once you pay attention to the team and who are the people who are funding this company then
you should be in a better position to make a decision yeah i think one of the things
i mean and i'm not trying to don't play beyonce's financial savvy but she also has a team of
financial advisors have everything well we studied this company exactly it's important to
to do your homework as well i know you're crucial it is crucial to do your homework you cannot
get and this is the next thing too if you're considering getting involved in a company for
equity versus a salary then you also have to take into consideration the company itself in terms of
the role that you play and can your role be that valuable to the company where
you're in a position to make the equity that you were given worth more in the future right right
so you have to be able to play that position if you can then i don't think it may actually work
out for it it doesn't make any sense all right um so and this the last thing is what stage are you
at in your career yes so like i said if you're at the start of your career if you have student
loans if you have all of these things um you might if you have if you live at home
then obviously you have some sort of financial question right so you still see with the parents
you have some sort of financial question so in that case you can't consider equity right but if
you're maybe more established and you're thinking about you know like i really want to build my
nest egg no the equity might not be so worthwhile for you because you might actually need cash now
to fund your equity might be a long-term thing so it's so it's it's not just cotton dry no it isn't
it isn't it varies company by company proposal by proposal equity offered by equity offer like it's
all of them are judged individually but if you hit the right one
you're good to go huh that's no problem personal financial strategist kenisha mays breaking down
the numbers for us as it relates to equity versus upfront money do your research do your research
all right we're going to take a break we'll be right back here on smashmate kids morning time