Posted on November 29, 2023 @ 09:58:00 AM by Paul Meagher
- Unpaid work is a foundation of value for startups.
- Unpaid work is one of the most frustrating aspects of starting a new business as there is no guarantee that the work will ever be compensated.
Startups seek funding to create more value in their startup. At some point it certainly makes sense to seek an investor or funding so that you can conduct your business with more resources and volume. Your chances of funding are increased if you have put in an appropriate amount of prior unpaid work, aka sweat equity, to create value in your startup. The unpaid work allows the entrepreneur to cite significant milestones they have achieved on route to the vision they are seeking funding for.
I have been making wine at our farm for a mini-winery business for the last 5 years without earning any income from my efforts. Maybe this is a case of persistence being a bad strategy, or I could look at it as me creating startup value through unpaid work. Certainly I have days in which I wonder why I am doing all this work “for nothing”. I recently bottled some 2020 Blueberry Wine and did some taste testing. The results gives me hope that the work is not in vain. The next stage in my unpaid winemaking work involves submitting paperwork to regulators, getting a building inspection of my barn, getting food insurance, creating labels for the wine, and many other hoops. Hopefully, by next summer I will have my first paying customer and start to reap some reward for this unpaid work. My short term goal is to have income from the winemaking business start to pay for the costs and for further development.