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A Different Approach to Refreshing Stock Option Grants

Feld Thoughts

I’ve never really understood why the majority of stock option refresh grants are stacked grants mid-way through the granting process. Assume you hire someone and grant them 10,000 options with monthly vesting of four years with a one year cliff. One thing, however, has always baffled me. Let me give an example.

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Should board members be elected “for life?”

Berkonomics

We have investigated the restrictions imposed by investment documents and the obvious need to keep continuity on the board with the retention of the CEO position at the very least. Practically speaking, this is an impossible goal. How about loss of institutional knowledge?

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Should You Offer Equity Compensation to Employees?

Up and Running

If however you are giving a “normal employee” an incentive stock option plan (more on that later), that’s entirely different. Make sure you understand all of your options before making any decisions. More often than not, equity compensation is an attraction and retention tool, rather than a replacement to salary.

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How Should You Set Up Your Company’s Benefits Structure?

The Startup Magazine

Also factor in the value of recruitment and employee retention as part of your calculations; if you can spend a little more on perks and in doing so increase loyalty, this might help you justify the expense. As such, any aims you have for your employee benefits structure must be centered around a realistic budget. Simplify access to benefits.

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Should Startups Care About Profitability?

Both Sides of the Table

It was a stock option incentive related “expense” but I bet you didn’t know that because in an era where we only read the headlines — they must be a train wreck losing billions. They got a bigger office space so their employees would feel comfortable and they could improve employee retention. Two-f **g-billion! What a disaster!

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Choke the Churn: How to Prevent Employee Turnover in Startup Businesses

Up and Running

It is important to develop a retention plan right off the bat to keep employee turnover in your small business from becoming a very costly and aggravating expense. If you can, provide stock options for your employees. Here is how to do it. Hire the right people. Be transparent with employees.

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How Great, Operationally-Focused CFO’s Can Transform Your Business

Both Sides of the Table

than to have to deal with healthcare benefit options, vacation policies, health-and-safety regulations and so forth. Stock option top-ups after a few years are vital retention mechanisms. Yet being a buttoned up company requires all this. And it turns out that employee reviews matter.