Getting Funded » Blog Archive » Equity Compensation to Attract, Retain and Align Employees
I attended the Sept 22, 2010 TCN lunch program at Wolf and Company on "Equity Compensation & the Perils of 409A". Scott Goodwin, the head of the technology practice for Wolf and Company and Michelle Basil, with Nutter McClennen and Fish LLP led a very in-depth discussion of this important topic which is relevant to all early stage entrepreneurs. In the room were individuals from many different types of companies in different sectors leading to diverse perspectives and questions. After the meeting, I reflected on how important this issue is with respect to bringing on employees to help grow a team. For companies, a firm understanding of equity compensation and its implications is critical to attract, retain, and align employees and protect your company from legal ramifications associated with non-compliance.
One sage word of advice from both Michelle and Scott before we dove into the presentation and discussion was to always contact your lawyer before enacting a stock option plan. This seems like a very reasonable thing to do, but some companies will enact option plans without considering legal input leading to inopportune outcomes....
http://bit.ly/9HXISj - [Interesting in that it, like so many articles, gives the "correct" ranges of ownership to grant in a start-up. (No these numbers do not match with the numbers in other articles)]
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