[jzd131]

Its an interesting concept. However, it may never work for one simple reason "risk". When my partners and I started our company the risk that we took was astronomical, leaving our high-paid jobs, masters, phd's to start a company. This risk needs to be rewarded and it is via equity. Building a company that is there only for its employees does not provide the founders with enough reward to warrant the risk.

This does not include the stress it takes to start and run a company, that stress should be equally as rewarded.

[marcus_holmes]

I've played around with co-operative business structures for this sort of thing, and if the shares are awarded to each employee as a straight split each year (so year 1 creates 100 shares, which are split 50% to the 2 founders, then year 2 creates 100 shares which are split 33% each to 2 founders and 1 employee, and so on) then the founders tend to end up with an outsize lump of shares, and the early employees do well too.

It ends up rewarding early employees more than the normal company structure, but I think that's a good thing; they normally have to go through a lot of disruption (and a fair amount of risk; the chances of the startup not being able to make payroll occasionally are high) and are a key element to the success of the organisation anyway.

[ringdabell]

I think you can have both, something that rewards founders for their risk while also providing for your employees.

Remember that it's a bit of catch-22 in the sense that you need your employees in order to make your company into a big success. Rewarding your employees and creating a culture that's awesome incentivizes loyalty, hard work, etc.

Be careful of this founder-before-all mentality... no one wants to work in a fiefdom...