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by vladimirralev 4089 days ago
These are well known risks and investors can simply demand a commitment. It is a very easy conversation to have with your employees. "Hey, if you sign this 2 year commitment we get like 10% more valuation". Everybody decides for themselves if it's worth it and the more people sign the better the valuation. And since everybody has more stock they have more interest to do it; You can also legally provision stock lock ups after IPO for 2 years or so, everybody does it. Also you can dilute the stock to allocate the 10% which represents the expected valuation hop. Then award the extra stock to those who sign. This is legal, but it's a lot of paperwork to make sure nobody can dispute the true value of the retention policy.