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You can't increase his equity without buying back shares and that's going to cost money. But yes the general sentiment is if you are serious about reducing cos
by qbasic_forever 4y ago
You can't increase his equity without buying back shares and that's going to cost money. But yes the general sentiment is if you are serious about reducing costs, then reducing salary is a major way to get there. The idea is cut costs and the share prices will rise as the company becomes more profitable.
- bberenberg 4y agoThat's not really how equity works. A company can issue equity out of thin air, and in fact, this is how most employee stock based comp works. In fact, Google specifically is criticized on their financial returns because of how much of their compensation is based in equity which dilutes existing shareholders outside the company. You can read about the high level ideas of this at https://www.wallstreetprep.com/knowledge/modeling-stock-based-compensation/ https://www.wallstreetprep.com/knowledge/modeling-stock-base...