A system for recording what each person puts in, usually time, cash, revenue impact, or IP. Essential for dynamic equity models where ownership reflects actual contributions.
Why it matters
If you don't track contributions, you can't split equity fairly. Memory fades. People remember their own contributions and forget others'. Having a record eliminates arguments and gives you data to make informed decisions about ownership.
How it works
Each contributor logs time worked and cash invested at agreed-upon market rates. Time is typically valued at what the person could earn for similar work elsewhere. Cash is tracked at face value, sometimes with a multiplier to account for the risk of investing in an early-stage company. For example, if a developer logs 40 hours at a $150/hour market rate, that's $6,000 in contribution value for the week. Equity Matrix automates this by letting contributors log directly from the app or Slack.
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