Is a ratio defined as follows:

= (Total investment by the investor in Newco per ordinary share)

divided by

(Total investment by a manager in Newco per ordinary share)

Investor typically invests in debt like instruments and ordinary shares, whereas management typically invests in ordinary shares only. As a consequence, the investor pays more per ordinary share than the management.

Envy Ratio's vary between 1 and 10, depending on the negotiation power of the management, the competition on the transaction, and the "culture" of the investment fund. Many funds indeed prefer to structure the MIP through "ratchets" rather than through an Envy Ratio.