4 ms·
I wanted to know how you would structure a profit sharing plan as an alternative to equity options for a small, bootstrapped company with virtually no IPO optio
by DFinancial 11y ago
I wanted to know how you would structure a profit sharing plan as an alternative to equity options for a small, bootstrapped company with virtually no IPO option. What would be fair? How would it work? How did WooFoo's program work? Consider this a blog post option too!
- kevin 11y agoOur profit sharing plan pretty much followed the two pool approach. Here's a decent resource covering it: http://www.pearlmeyer.com/Pearl/media/PearlMeyer/PDF/PMP-WAWART-Twopoolapproach-JHeim-11-10.pdf http://www.pearlmeyer.com/Pearl/media/PearlMeyer/PDF/PMP-WAW... That is, of course, if you have profits. Also, be careful. Extrinsic motivations like profit sharing doesn't correlate perfectly with productivity and performance. At some point, you're just throwing money away if you're just giving it all directly to employees. You'll get more bang for your buck if you spend first on things that create intrinsic motivations in your employees like a mission driven culture.