There are several ways that equity owners can get paid, such as through dividends, capital gains, or a company sale.
Dividends are payments companies make to shareholders. They are typically paid out of the company's profits and can take the form of either cash or stock.
Capital gains are profits that investors gain when they sell their shares for more than they paid for them. For example, if you buy shares of a company for $10 per share and sell them later for $20 per share, you have made a $10 capital gain.
A company sale occurs when the company is sold to another business or taken public through an initial public offering (IPO). Company sales often result in a large payout to the company's shareholders.
Employees typically do not receive dividends or capital gains from their stock options until they exercise their options and buy shares of the company. However, employees can get paid for their equity when the company sells to another company.