I was writting a business plan last night in which I was proposing how equity would be divided between the founders. My first though was to split the entire worth of the company evenly between three founders. Then I added a vesting period. But then it hit me. Stock options shouldn’t be granted based on time employeed but on performance. I quickly revised my plan to grant a much smaller initial incentive to the founders and leave a larger pool for to be granted based on achieving performance goals.
I got up this morning and read PaulAllens’s blog Stock Options Vesting Based on Milestones, Not Calendar Months
This comment from Eliot W. Jacobsen on Pauls post also caught my eye
But now that companies must expense option grants and/or vesting in some cases, that disadvantage may be reduced, paving the way for more performance-based stock incentives. That would be good.
