I don't know if this is the right place to ask, but I was wondering if it is a fair exchange to offer equity instead of payment for services in business.
For example, "John" signs a contract stating that he will receive equity in the revenue of whatever industry/company/etc. he is contributing to, instead of paying him for doing it. It isn't "free work" because equity stake can be worth a lot of money should the business grow big -- and a contract guarantees he/she gets their cut. In such eyes, equity stakes can be more rewarding than a single payment for a service. Here's an example:
Bob is trying to start a company, but needs suppliers. He offers the suppliers equity stake in his future earnings indefinitely should they provide him with the supplies he needs to start his business. It may not be that he can't pay nor doesn't want to invest himself. Perhaps he has faith in his business expanding and will fairly share the stake he offers to the service provider for the rest of his business.
In other words, he would rather his investors take their chances like him, but have the ability to earn their share of the company's/etc. success continuously, as opposed to only a one-time exchange.
In general, is this bad practice? Would this be a good or bad thing to offer to high-quality freelancers looking for work: an equity stake instead of money/benefits directly?