Do You Give Equity?
Summary
- I believe the only person in the business guaranteed to stay is myself. Everyone else might leave someday, which is why I think carefully about giving anyone stock.
- I love our team and want everyone to stay forever. Some of my best friends are our leaders, but I know people sometimes leave which can be hard.
- I avoid giving stock options because it would hurt more if they left and took it with them when they go.
- Moving into a leadership role here can get you very well-paid. You'll earn money based on the bottom line, which can be a lot.
- I don't have any greed when it comes to paying leaders well.
Video
https://www.youtube.com/watch?v=zOywdwBkMcU
How To Take Action
I would suggest implementing a mindset where you view yourself as the only permanent fixture in your business. Everyone else might leave eventually, so plan with that in mind. This means being careful when offering stock or equity, as it can be painful if someone departs with a piece of your business. Instead, consider rewarding team members with competitive compensation directly tied to the bottom line. This attracts and retains talented leaders without committing long-term equity.
Think about creating a clear path to leadership that offers lucrative financial incentives. This motivates people to aspire to higher roles and helps align their interests with the company’s success. Make sure to compensate fairly and generously, so they see the value of staying with your company. It’s important to let your team know that you value their contributions and are committed to sharing the company’s success.
Finally, embrace a culture that encourages open communication and connection with your team. Build strong relationships with leaders and employees to foster loyalty and mutual respect. Even as a small business or entrepreneur starting out, focusing on fair compensation and strong relationships can create a positive, rewarding environment.
