I think the important bit here is the time/money tradeoffs. I mean, sure, I can live on two grand a month, but that means I'm cooking most of my own food, repairing my own car, etc... I mean, those are all fine things to do, but if you are investing in my business, it might be worth the cash to pay me enough that I can afford to pay other people to deal with my personal needs. I mean, if I spend the money on a new BMW, that doesn't help you. But for the same money, I can have someone come by and clean my house once a week, and have enough left over to get takeaway on busy nights. Both of those things will free up time for me to make money for both of us.