To install click the Add extension button. That's it.

The source code for the WIKI 2 extension is being checked by specialists of the Mozilla Foundation, Google, and Apple. You could also do it yourself at any point in time.

Kelly Slayton
Congratulations on this excellent venture… what a great idea!
Alexander Grigorievskiy
I use WIKI 2 every day and almost forgot how the original Wikipedia looks like.
Live Statistics
English Articles
Improved in 24 Hours
Added in 24 Hours
Show all languages
What we do. Every page goes through several hundred of perfecting techniques; in live mode. Quite the same Wikipedia. Just better.

From Wikipedia, the free encyclopedia

Envy ratio, in finance, is the ratio of the price paid by investors to that paid by the management team for their respective shares of the equity. It is used to consider an opportunity for a management buyout. Managers are often allowed to invest at a lower valuation to make their ownership possible and to create a personal financial incentive for them to approve the buyout and to work diligently towards the success of the investment. The envy ratio is somewhat similar to the concept of financial leverage; managers can increase returns on their investments by using other investors' money.

Basic formula



If private equity investors paid $500M for 80% of a company's equity, and a management team paid $60M for 20%, then ER=(500/80)/(60/20)=2.08x. This means that the investors paid for a share 2.08 times more than did the managers. The ratio demonstrates how generous institutional investors are to a management team—the higher the ratio is, the better is the deal for management.[2]

As a rule of thumb, management should be expected to invest anywhere from six months to one year’s gross salary to demonstrate commitment and have some personal financial risk.[3] In any transaction, the envy ratio is affected by how keen the investors are to do the deal; the competition they are facing; and economic factors.[4]

See also


  1. ^ "M&A Academy Dealing with underwater management equity arrangements" (PDF). Archived from the original (PDF) on 2012-03-11. Retrieved 2010-09-03.
  2. ^ "Structuring a venture capital deal" (PDF). Archived from the original (PDF) on 2011-07-17. Retrieved 2010-10-07.
  3. ^ "MBOs & MBIs - MBO Guide". Archived from the original on 2011-04-09. Retrieved 2010-09-03.
  4. ^ "Structuring a venture capital deal" (PDF). Archived from the original (PDF) on 2011-07-17. Retrieved 2010-10-07.

External links

This page was last edited on 29 September 2019, at 01:34
Basis of this page is in Wikipedia. Text is available under the CC BY-SA 3.0 Unported License. Non-text media are available under their specified licenses. Wikipedia® is a registered trademark of the Wikimedia Foundation, Inc. WIKI 2 is an independent company and has no affiliation with Wikimedia Foundation.