Cash buys down points
A schedule is a fixed pair of a cash rate and a points rate, elected when you join. The more certainty you take in cash, the less of the upside you accrue — continuously, per hour, on a curve anyone can read.
Ownership is your points divided by the pool, and points are hours times a rate. The rate is the whole design. It is set by a schedule — a fixed pair of a cash rate and a points-per-hour rate — that a contributor elects when they join, records on the ledger, and keeps. One line, and it settles the oldest argument in every founding: who gets paid, and who gets a piece.
The answer here is that you don’t choose one or the other in the dark. You choose a point on a curve. Take no cash and carry the full risk, and every hour earns the pool’s full rate. Take a guaranteed cash floor, and each hour still earns points — just fewer of them, in exact proportion to the certainty the cash bought you. Cash buys down equity, continuously, per hour, in the open — not in a one-time grant negotiation nobody else in the room ever gets to see.
The schedule book
The XJ schedule book shows the design space. The names are internal shorthand; the two numbers next to each are the entire contract.
| Schedule | Cash | Points / hr | The trade |
|---|---|---|---|
| A1 | none | 1.000 | Full risk, full equity rate. The founding schedule. |
| C1 | $25 / hr | 0.660 | A partial cash floor, a majority equity rate. |
| M1 | $50 / hr | 0.330 | Market-adjacent cash, a minority equity rate. |
| D1 | $60 / hr | 0.174 | Near-full cash, a token equity rate. |
| A2 / I1 / I3 | varies | 0.30–0.60 | Later-stage or supervised roles; rates set at joining. |
Read the top three rows as one line moving. Zero cash earns 1.000 point an hour. Twenty-five dollars an hour drops it to 0.660. Fifty dollars an hour drops it to 0.330. The dollars you take out of the risk come straight off the points you put into the pool — a dial, not a switch. Exact rate books are set per project at formation; the invariant never changes: uncompensated founding labor earns the full rate, and every contributor on the same schedule earns identically.
One person, four lines
The cleanest proof isn’t a diagram. It’s a single real contributor who worked more than one schedule over the years, each spell logged on its own line, side by side on one ledger.
| Schedule | Hours | Cash rate | Cash paid | Points / hr | Points |
|---|---|---|---|---|---|
| A1 | 1,885 | — | — | 1.000 | 1,885 |
| C1 | 889 | $25.00 | $22,225 | 0.660 | 586 |
| M1 | 214 | $50.00 | $10,700 | 0.330 | 70 |
| I1 | 148 | — | — | 0.300 | 44 |
The same hands, four different bargains. When they worked founding hours for no cash, those hours earned the full rate — the identical 1.000 the founder’s own hours earned. When they later took a cash floor, the point rate stepped down to match the cash that stepped up: $25 an hour bought the rate down to 0.660, $50 an hour to 0.330. The fourth line is a later supervised role at a low rate. Nothing is blended, nothing is averaged, nothing is renegotiated after the fact. You can put the whole thing on a calculator: 889 hours times 0.660 is 586 points, and 586 divided by the pool is that spell’s share of the company.
That is the argument for the whole model in one contributor’s history. Cash and equity are not two separate systems bolted together — a salary over here, an option grant over there, each opaque in its own way. They are one continuous trade, priced per hour, printed on a ledger every member holds.
Why a curve beats a negotiation
The usual way to answer “cash or equity” is a closed-door negotiation that produces a founder multiple, a preferred class, a side letter — instruments whose entire job is to make the answer hard to read later. The schedule replaces all of it with a number you pick once and can always check. Nobody has to trust that the split was fair, because the split is arithmetic and the arithmetic is public. If you can divide, you can read the cap table.
See it demonstrated end to end on the studio’s own work — the published XJ founders pool — where the same person’s full-rate founding points and reduced-rate paid points sit four lines apart on one page. And for where this idea comes from, read the tradition it belongs to.
This describes how the studio shares ownership. It is not legal, tax, securities, or investment advice, and nothing here is an offer or solicitation to buy or sell a security or to invest money.