Equal ≠ Equitable

By Matt Perez

“Equal” assumes that everybody being treated financiall equally is enough. It seems to work for a while, but the it stops working. “Equitable” is based on contributions. It scales.

 

 ∇ 
EQUAL EQUITABLE

They Are Not the Same

“Equal” and “Equitable” are not the same,

Equal Everybody must be treated equally. It seems to work for a while, but then it stops working. Because everybody is not equal.
Equitable It is based on contributions. It scales.

By Committee

Let’s say that the distribution is done by a boss or a committee, all with good intentions. In the early days, with a small team, the boss or committee knows everybody and knows their work and they assign money, or stock, or whatever equitably. As the team grows, the boss or committee knows less and less of the new people as individuals. At that point, the distribution starts to get out of whack and they make up rules that lean towards equality.

The old people notice and feel nostalgic. The next wave of people also notice and feel it’s somewhat unfair, but the old folks deserve it. The newest people also notice, feel unappreciated, and soon quit.

This Fiat system doesn’t scale mostly because it allows a few benevolent people to make it bearable. Any more than a few might be a problem.

Everybody a Co-Owner

People in Radical-based companies recognize contributions as they happen. It makes everybody a co-owner.

It scales because,

  • New people join a team.
  • They know everybody in the team and what each does.
  • The team gets to know the new folks and what they do.
  • Everybody gets to recognize contributions as they happen.
  • As the community scales in size, co-owners in teams still know each other and can recognize contributions made by each.
  • Co-owners will learn to communicate more globally.

Contribution Recognitions

The recognition of Contribution works like this,

  • Goes on all the time, not a quarter or a year later when memories get fuzzy.
  • Are done by everybody, not just a small group.
  • Co-owners don’t need to be benevolent or even angelical. They just need to know enough about the people around them. They know when a co-owner talked to another who was down in the dump and by the end of it their mood had visibly improved. And, yes, this is biased by many things: her mood, whether or not she likes the other co-owner, etc. But other co-owners are biased as well in the other directions and overall they strike a much better balance than the boss or committee.

This way, each co-owner gets to distribute the ownership of the company and its dividends to other co-owners. And they do it all the time, as they see those contributions happen. They can do this via the RADs! mobile app.

Giving RADs

Every co-owner gets one RAD per day to give, not to keep. She gets to give them to other co-owners based on what feels like contributions to her. Different co-owners will get different amounts of RADs from various other co-owners. ∇ 

The distribution may end with this, depending on contributions,

Or like this,

Or even like this,

This distribution will most likely change again in future cycles as things change. ∇ 

What Is a Contribution

In Fiat businesses the only contribution recognized is one that grows to the wealth of the business owners,

Owning a business is the fastest reliable way to wealth.… That’s because once your business is established, you can earn more as the business grows without the need to work additional hours. ∇ 

In Radical-based companies, contributions add to the wellbeing of all co-owners.

ENDNOTES

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