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Category: ESOP

The Benefits of Employee Ownership: Empowering Your Workforce

Employee ownership is more than just a trend—it’s a strategic move that can have significant benefits for both businesses and their employees. By offering employees a stake in the company’s success, businesses can foster a sense of ownership, align interests, and promote long-term growth. Let’s explore the benefits of employee ownership and why it could […]

Waterfall Modeling for Private Equity

Understanding the Dynamics of Waterfall Modeling Waterfall modeling is a critical aspect of financial planning and analysis for both private equity firms and the companies they invest in. It’s a complex methodology that determines how profits are distributed among various stakeholders over the life of an investment. In recent years, with the increasing sophistication of […]

Secondary Transactions in APAC: How Employees Can Unlock equity compensation Rewards

In the Asia-Pacific (APAC) region, employee equity compensation plans have become an increasingly popular method of rewarding and motivating employees. These plans allow employees to share in the success of the company by providing them with stock options, restricted stock units, or other forms of equity. However, employees often face challenges when trying to access […]

SAFEs vs Convertible Notes: Different Sectors Prefer Different Pre-Seed Structures

When it comes to raising pre-seed capital for startups, entrepreneurs often find themselves at a crossroads, deliberating over various funding structures to fuel their ventures. Among the most popular options are SAFE (Simple Agreement for Future Equity) notes and convertible notes, both offering flexibility and advantages tailored to different needs and preferences. However, what might […]

Differences between stock based compensation expense under US GAAP and IFRS?

Under US Generally Accepted Accounting Principles (GAAP), the accounting for stock-based compensation expense is governed by the Financial Accounting Standards Board (FASB) Statement No. 123 (revised 2004), “Share-Based Payment.” International Financial Reporting Standards (IFRS) have a similar standard for stock-based compensation, IAS 2, “Inventories.” However, there are some key differences between the two sets of […]

Equity and token convertibles demystified: SAFEs, SAFTs, and token warrants.

Overview  Token warrants are an increasingly popular option for financing emerging blockchain projects wherein investors provide early-stage funding in exchange for tokens. This method of fundraising is growing in popularity as a result of poor market conditions, which are forcing many blockchain project teams to either delay or completely halt token issuance. Although token warrants […]

Stock-Based Compensation

The accounting and tax treatment of stock-based compensation is generally similar to that in other countries globally. When a company grants stock-based compensation to its employees, it records the value of the stock as an expense on its financial statements. This is because the company is effectively giving up some of its ownership in exchange […]

Team Compensation: ESOP vs. Token Vesting

You will get more from your employees and they will be more committed if you share equity immediately in a meaningful way, so that everybody rises up.  – Mark Cuban, entrepreneur, television personality, media proprietor Employee share option plan (ESOP) are widely becoming accepted as forms of compensation, in addition to traditional cash.  Invented in […]

Regional ESOP Tax Cheat Sheet

Sprout’s tax cheatsheet for ESOPs is a useful resource for HR and finance administrators in Asia who need to navigate the complex landscape of tax rates and rules. The cheatsheet provides a clear and concise overview of the tax implications of ESOPs in various countries across Asia, making it easy for administrators to quickly find […]

Employee Share Options – how to start your journey

There are plenty of success stories of employees who made a fortune alongside the founders of their startup companies. In 2004 when Google listed, co-founders Larry Page and Sergey Brin saw the value of their shares skyrocket. They joined the ranks of the richest people in the world. At the same time, approximately 900 other […]

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