After some thought, Jim structures his approach as follows: 1. I have $50,000 of my own...

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After some thought, Jim structures his approach as follows: 1. I have $50,000 of my own cash in the brewpub and one and a half years of seventy-hour weeks. 2. I have taken only a small amount of cash out of the business for my living expenses, certainly not equal to a reasonable wage. 3. In college, I worked at a brewpub for $10 an hour, but that college degree ought to be worth at least $5 more per hour. 4. It seems like I have about $131,900 [$50,000+ (78 × 70 × $15)] of cash and sweat in this brewpub. 5. $100,000+ $131,900 = $231,900, and 100,000/231,900 is about 43 percent. 6. I can take the $100,000, remain the majority owner, and take a shot at the big time. Done... I think. Before signing the deal, he decides to run his thinking by an acquaintance more closely connected with the financial aspects of business valuation and investment ... you. After some thought, Jim structures his approach as follows: 1. I have $50,000 of my own cash in the brewpub and one and a half years of seventy-hour weeks. 2. I have taken only a small amount of cash out of the business for my living expenses, certainly not equal to a reasonable wage. 3. In college, I worked at a brewpub for $10 an hour, but that college degree ought to be worth at least $5 more per hour. 4. It seems like I have about $131,900 [$50,000+ (78 × 70 × $15)] of cash and sweat in this brewpub. 5. $100,000+ $131,900 = $231,900, and 100,000/231,900 is about 43 percent. 6. I can take the $100,000, remain the majority owner, and take a shot at the big time. Done... I think. Before signing the deal, he decides to run his thinking by an acquaintance more closely connected with the financial aspects of business valuation and investment ... you.

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