Equity vs. endorsement: the ten-year math.
The two pages every manager, business manager and entertainment attorney ends up building for themselves the first time a client is offered ownership instead of a fee. We built it properly so you can forward it internally instead.
The same client, two different decades
Take one artist with a real audience and a credible reason to be in beauty. Put an endorsement contract in one hand and a funded founder-equity venture in the other, and follow both for ten years. The comparison below uses illustrative, deliberately conservative composites of publicly reported deals - not projections.
| Endorsement deal | Founder-equity venture | |
|---|---|---|
| Year-one economics | Fee, typically $500K–$2M for a strong name | Little or no cash; founder equity issued, first revenue late in year one |
| Cash certainty | High - contractual | Low early; distributions only when the company generates them |
| Year three | Contract expired; renewal at the brand's option | Operating company; the publicly reported benchmark exit at this age is Rhode's ~$1B sale to e.l.f. |
| Year ten | $0 residual; the campaign belongs to someone else's brand | Equity in a company that either compounded, was sold, or failed - an asset with a real distribution of outcomes |
| Tax character | Ordinary income, one tax year | Largely capital in nature at exit, subject to counsel's structuring and jurisdiction |
| Estate value | None | Transferable ownership - the difference between income and legacy |
| Downside | Opportunity cost only | Time invested in a venture that may not reach scale - which is why structure and reversibility matter more than headline percentages |
| What it demands of the artist | Shoot days and usage rights | Genuine involvement: product approval, creative direction, visible authentic use |
Figures on this page are illustrative composites drawn from publicly reported transactions; they are not a projection, an offer, or legal, tax or investment advice. Every structure is negotiated per venture in definitive agreements prepared by counsel. StarPower is not affiliated with and has not been endorsed by any artist or brand named in public case studies.
Why the fee is usually the wrong unit of negotiation
An endorsement negotiation argues over the size of one check. An equity negotiation argues over four different levers at once - initial position, vesting triggers, downside protection (a recoupable guaranteed minimum, a royalty floor, a reversible pilot), and exit rights. A competent adviser can usually improve two or three of those levers in a single markup round; nobody improves an expired contract.
The publicly reported precedents are on the record: Fenty was reported as a near 50/50 joint venture with LVMH. Rare Beauty is majority founder-owned. Rhode was founder-controlled at its reported ~$1B sale. Kylie Cosmetics sold 51% to Coty for a reported $600M. We publish structure-level teardowns of each - written for the adviser doing diligence, not for fans.
Deal teardowns
Structure-level analyses of the reported precedents - ownership, control, and exit mechanics.
Browse the teardown library →
The public deal memo
The redacted shape of a StarPower artist deal - ranges, gates and governance, published for transparency.
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The adviser pathway
Who funds what, who owns the IP, what happens on disengagement - the diligence page.
For managers, agents & advisers →
The two-page brief, for forwarding
A print-clean PDF of this analysis - the ten-year table, the four negotiating levers, and the six questions to ask any platform - formatted to forward to a colleague or client team. Enter a work email and the download unlocks.
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