Many founders setting up an ESOP Plan for the first time might be affected by the Where-do-I-start syndrome! As if understanding the umpteen ESOP terminologies is not enough, one is also expected to subjectively decide on these key variables to setup an ESOP plan to attract and retain the best talent in the industry. No wonder founders grapple with a whole set of questions they are unclear about:
- What should be the pool size?
- Whom should I give ESOPs to in my company?
- What should be the vesting schedule?
- Should I allow exercise post employees leaving my company?
- When should I consider doing a liquidity/buyback event
As a founder do you relate to this conundrum?
These questions are relevant and extremely important. More so now than ever before!