- Stock Options Plans are offered by companies to their employees, advisors or consultants as equity compensation plans.
- There’s a difference between options and shares. Options gives the participant the right to buy shares in the future at a pre-agreed price.
- Share options can be an effective incentive to attract and retain talented employees. They can also motivate your team and boost productivity.
- Shares don’t become available right away. Instead, the options go through a vesting period and become available over time.
- There are different types of vesting: time and performance based.
The best timing for you to set up your options plan is before a funding round and/or before you hire new employees when you’re about to scale.