Stock based compensation mix evolved from this thesis, and quite common in the valley and why almost all OpenAI staff wanted Sam Altman back even though the non profit board did not.
Aligning key talent's compensation to enterprise value is only viable in unrestricted for profit entities any other structure with limits (capped profit, public benefit corporation, non profit, trust, 501c's etc) does not work as well.
Talent will then leave to a for-profit entity who can offer better compensation than a restricted entity can because they share a % of their enterprise value which restricted ones either cannot or not have same liquidity/value [1] etc.
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[1]This is why public companies are more valuable for RSU/options than private companies, and why cash flow positive companies like Stripe still raise private money to just give liquidity to employees .
In modern management compensation theory (https://saylordotorg.github.io/text_introduction-to-economic... ) this is key to why executive compensation has increased much faster than workers in the last 50 years.
Stock based compensation mix evolved from this thesis, and quite common in the valley and why almost all OpenAI staff wanted Sam Altman back even though the non profit board did not.
Aligning key talent's compensation to enterprise value is only viable in unrestricted for profit entities any other structure with limits (capped profit, public benefit corporation, non profit, trust, 501c's etc) does not work as well.
Talent will then leave to a for-profit entity who can offer better compensation than a restricted entity can because they share a % of their enterprise value which restricted ones either cannot or not have same liquidity/value [1] etc.
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[1]This is why public companies are more valuable for RSU/options than private companies, and why cash flow positive companies like Stripe still raise private money to just give liquidity to employees .