Incentives to employees work best when they meet two criteria: 1) They are directly linked to performance. Giving our random amounts of money (eg, Christmas Bo

Incentives to employees work best when they meet two criteria: 1) They are directly linked to performance. Giving our random amounts of money (eg, Christmas Bonus because the business had a good year) can backfire because it sets the expectation that such incentives will be standard, not a bonus. Rewarding those employees who meet or exceed their targets - financial or otherwise - encourages them to keep working hard. 2) They should be personal. Most people would rather you spend $x on a personal gift (eg, movie tickets) than give them some multiple of x in cash. It shows you care. Regarding the angels, I would again ensure you understand their personal motivation and expectations. If they want an equity stake because they think you could be huge, chances are they would rather you reinvested in strategic growth than return a dividend.